10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2019

or

☐ TRANSITION REPORT PURSUANT TO Section 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                        to                       .

Commission file number: 000-11688

US ECOLOGY, INC.

(Exact name of registrant as specified in its charter)

Delaware	95-3889638
(State or other jurisdiction of incorporation or	(I.R.S. Employer Identification No.)
organization)
101 S. Capitol Blvd., Suite 1000
Boise, Idaho	83702
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (208) 331-8400

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	ECOL	NASDAQ Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes ⌧  No ◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes ⌧  No ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer ⌧ Accelerated Filer ◻ Non-Accelerated Filer ◻ Smaller Reporting Company ☐ Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).  Yes  ☐     No  ☒

At July 30, 2019, there were 22,089,345 shares of the registrant’s Common Stock outstanding.

US ECOLOGY, INC.

FORM 10-Q

TABLE OF CONTENTS

Item		Page
	PART I — FINANCIAL INFORMATION
1.	Financial Statements (Unaudited)	3
	Consolidated Balance Sheets as of June 30, 2019 and December 31, 2018	3
	Consolidated Statements of Operations for the three and six months ended June 30, 2019 and 2018	4
	Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2019 and 2018	5
	Consolidated Statements of Cash Flows for the six months ended June 30, 2019 and 2018	6
	Consolidated Statements of Stockholders’ Equity for the three and six months ended June 30, 2019 and 2018	7
	Notes to Consolidated Financial Statements	8
	Report of Independent Registered Public Accounting Firm	30
2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	31
3.	Quantitative and Qualitative Disclosures About Market Risk	45
4.	Controls and Procedures	46
	PART II — OTHER INFORMATION
	Cautionary Statement	47
1.	Legal Proceedings	48
1A.	Risk Factors	48
2.	Unregistered Sales of Equity Securities and Use of Proceeds	48
3.	Defaults Upon Senior Securities	49
4.	Mine Safety Disclosures	49
5.	Other Information	49
6.	Exhibits	50
	SIGNATURE	51

2

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

US ECOLOGY, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands, except par value amount)

	June 30, 2019		December 31, 2018
Assets
Current Assets:
Cash and cash equivalents	$	17,690	$	31,969
Receivables, net		150,037		144,690
Prepaid expenses and other current assets		11,938		10,938
Income taxes receivable		6,661		7,071
Total current assets		186,326		194,668
Property and equipment, net		265,620		258,443
Operating lease assets		17,575		—
Restricted cash and investments		5,021		4,941
Intangible assets, net		274,866		279,666
Goodwill		210,466		207,177
Other assets		1,542		3,003
Total assets	$	961,416	$	947,898
Liabilities and Stockholders’ Equity
Current Liabilities:
Accounts payable	$	21,733	$	17,754
Deferred revenue		12,985		10,451
Accrued liabilities		32,895		35,524
Accrued salaries and benefits		14,790		16,732
Income taxes payable		—		505
Current portion of closure and post-closure obligations		2,231		2,266
Current portion of operating lease liabilities		4,932		—
Total current liabilities		89,566		83,232
Long-term debt		334,000		364,000
Long-term closure and post-closure obligations		77,688		76,097
Long-term operating lease liabilities		12,553		—
Other long-term liabilities		4,132		2,146
Deferred income taxes, net		66,718		63,206
Total liabilities		584,657		588,681
Commitments and contingencies
Stockholders’ Equity:
Common stock $0.01 par value, 50,000 authorized; 22,089 and 22,040 shares issued and outstanding, respectively		221		220
Additional paid-in capital		184,747		183,834
Retained earnings		204,916		189,324
Treasury stock, at cost, 14 and 8 shares, respectively		(835)		(370)
Accumulated other comprehensive loss		(12,290)		(13,791)
Total stockholders’ equity		376,759		359,217
Total liabilities and stockholders’ equity	$	961,416	$	947,898

The accompanying notes are an integral part of these financial statements.

3

US ECOLOGY, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In thousands, except per share amounts)

	Three Months Ended June 30,				Six Months Ended June 30,
	2019		2018		2019		2018
Revenue	$	155,802	$	136,912	$	286,839	$	256,971
Direct operating costs		106,219		95,464		202,015		179,852
Gross profit		49,583		41,448		84,824		77,119
Selling, general and administrative expenses		24,049		21,156		44,354		43,388
Operating income		25,534		20,292		40,470		33,731
Other income (expense):
Interest income		202		39		409		63
Interest expense		(3,588)		(2,907)		(7,618)		(5,716)
Foreign currency loss		(384)		(139)		(523)		(153)
Other		122		193		232		2,316
Total other expense		(3,648)		(2,814)		(7,500)		(3,490)
Income before income taxes		21,886		17,478		32,970		30,241
Income tax expense		6,395		4,258		9,436		7,778
Net income	$	15,491	$	13,220	$	23,534	$	22,463
Earnings per share:
Basic	$	0.70	$	0.60	$	1.07	$	1.03
Diluted	$	0.70	$	0.60	$	1.06	$	1.02
Shares used in earnings per share calculation:
Basic		22,006		21,867		21,997		21,835
Diluted		22,208		22,024		22,203		21,991

The accompanying notes are an integral part of these financial statements.

4

US ECOLOGY, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

(In thousands)

	Three Months Ended June 30,				Six Months Ended June 30,
	2019		2018		2019		2018
Net income	$	15,491	$	13,220	$	23,534	$	22,463
Other comprehensive income (loss):
Foreign currency translation gain (loss)		1,680		(1,597)		3,369		(3,468)
Net changes in interest rate hedge, net of taxes of $(313), $167, $(497) and $592, respectively		(1,177)		628		(1,868)		2,223
Comprehensive income, net of tax	$	15,994	$	12,251	$	25,035	$	21,218

The accompanying notes are an integral part of these financial statements.

5

US ECOLOGY, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

	Six Months Ended June 30,
	2019		2018
Cash flows from operating activities:
Net income	$	23,534	$	22,463
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization of property and equipment		17,254		13,649
Amortization of intangible assets		5,674		4,598
Accretion of closure and post-closure obligations		2,258		2,155
Property and equipment impairment charges		25		—
Unrealized foreign currency loss (gain)		(502)		1,222
Deferred income taxes		3,690		27
Share-based compensation expense		2,467		2,079
Unrecognized tax benefits		131		—
Net loss (gain) on disposition of assets		(142)		11
Gain on insurance proceeds from damaged property and equipment		(9,153)		—
Amortization of debt issuance costs		409		405
Changes in assets and liabilities:
Receivables		(5,346)		(2,087)
Income taxes receivable		452		(2,851)
Other assets		(1,384)		88
Accounts payable and accrued liabilities		404		10,286
Deferred revenue		2,418		1,770
Accrued salaries and benefits		(2,025)		(2,317)
Income taxes payable		(515)		(2,905)
Closure and post-closure obligations		(775)		(583)
Net cash provided by operating activities		38,874		48,010
Cash flows from investing activities:
Purchases of property and equipment		(24,657)		(14,960)
Insurance proceeds from damaged property and equipment		9,500		—
Proceeds from sale of property and equipment		512		141
Purchases of restricted investments		(400)		(498)
Proceeds from sale of restricted investments		354		431
Net cash used in investing activities		(14,691)		(14,886)
Cash flows from financing activities:
Payments on long-term debt		(30,000)		—
Payments on short-term borrowings		(14,384)		—
Proceeds from short-term borrowings		14,384		—
Dividends paid		(7,942)		(7,884)
Payment of equipment financing obligations		(408)		(217)
Proceeds from exercise of stock options		—		1,471
Other		(914)		(312)
Net cash used in financing activities		(39,264)		(6,942)
Effect of foreign exchange rate changes on cash		836		(902)
Increase (decrease) in Cash and cash equivalents and restricted cash		(14,245)		25,280
Cash and cash equivalents and restricted cash at beginning of period		32,753		28,799
Cash and cash equivalents and restricted cash at end of period	$	18,508	$	54,079
Reconciliation of Cash and cash equivalents and restricted cash
Cash and cash equivalents at beginning of period		31,969		27,042
Restricted cash at beginning of period		784		1,757
Cash and cash equivalents and restricted cash at beginning of period	$	32,753	$	28,799
Cash and cash equivalents at end of period		17,690		53,303
Restricted cash at end of period		818		776
Cash and cash equivalents and restricted cash at end of period	$	18,508	$	54,079
Supplemental Disclosures:
Income taxes paid, net of receipts	$	5,694	$	13,625
Interest paid	$	6,850	$	5,288
Non-cash investing and financing activities:
Capital expenditures in accounts payable	$	834	$	493
Restricted stock issued from treasury shares	$	451	$	11

The accompanying notes are an integral part of these financial statements.

6

US ECOLOGY, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)

(In thousands)

	Three Months Ended June 30,				Six Months Ended June 30,
	2019		2018		2019		2018
Total stockholders' equity, beginning balances	$	363,492	$	330,147	$	359,217	$	324,077
Common stock:
Beginning balances	$	221	$	219	$	220	$	218
Stock option exercises and issuance of common stock and restricted common stock		—		1		1		2
Ending balances	$	221	$	220	$	221	$	220
Additional paid-in capital:
Beginning balances	$	183,953	$	178,840	$	183,834	$	177,498
Share-based compensation		1,245		1,011		2,467		2,079
Stock option exercises and issuance of common stock and restricted common stock		—		836		(1,103)		1,121
Issuance of restricted common stock from treasury shares		(451)		—		(451)		(11)
Ending balances	$	184,747	$	180,687	$	184,747	$	180,687
Retained earnings:
Beginning balances	$	193,397	$	160,838	$	189,324	$	155,533
Net income		15,491		13,220		23,534		22,463
Dividend paid		(3,972)		(3,946)		(7,942)		(7,884)
Ending balances	$	204,916	$	170,112	$	204,916	$	170,112
Treasury stock:
Beginning balances	$	(1,286)	$	(370)	$	(370)	$	(68)
Repurchase of common stock		—		—		(916)		(313)
Issuance of restricted common stock from treasury shares		451		—		451		11
Ending balances	$	(835)	$	(370)	$	(835)	$	(370)
Accumulated other comprehensive income (loss):
Beginning balances	$	(12,793)	$	(9,380)	$	(13,791)	$	(9,104)
Other comprehensive income (loss)		503		(969)		1,501		(1,245)
Ending balances	$	(12,290)	$	(10,349)	$	(12,290)	$	(10,349)
Total stockholders' equity, ending balances	$	376,759	$	340,300	$	376,759	$	340,300

The accompanying notes are an integral part of these financial statements.

7

US ECOLOGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1.     GENERAL

Basis of Presentation

The accompanying unaudited consolidated financial statements include the results of operations, financial position and cash flows of US Ecology, Inc. and its wholly-owned subsidiaries. All inter-company balances have been eliminated. Throughout these financial statements words such as “we,” “us,” “our,” “US Ecology” and “the Company” refer to US Ecology, Inc. and its subsidiaries.

In the opinion of management, the accompanying unaudited consolidated financial statements include all adjustments (consisting only of normal recurring adjustments) necessary to present fairly, in all material respects, the results of the Company for the periods presented. These consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been omitted pursuant to the rules and regulations of the SEC. These consolidated financial statements should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018. The results of operations for the three and six months ended June 30, 2019 are not necessarily indicative of the results to be expected for the entire year ending December 31, 2019.

The Company’s consolidated balance sheet as of December 31, 2018 has been derived from the Company’s audited consolidated balance sheet as of that date.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ materially from the estimates and assumptions that we use in the preparation of our consolidated financial statements. As it relates to estimates and assumptions in amortization rates and environmental obligations, significant engineering, operations and accounting judgments are required. We review these estimates and assumptions no less than annually. In many circumstances, the ultimate outcome of these estimates and assumptions will not be known for decades into the future. Actual results could differ materially from these estimates and assumptions due to changes in applicable regulations, changes in future operational plans and inherent imprecision associated with estimating environmental impacts far into the future.

Recently Issued Accounting Pronouncements

In August 2018, the SEC adopted the final rule under SEC Release No. 33-10532, “Disclosure Update and Simplification,” adopting amendments to certain disclosure rules that were redundant, duplicative, overlapping, outdated, or superseded, in light of other SEC disclosure requirements, GAAP or changes in the information environment. In addition, the amendments expanded the disclosure requirements relating to the analysis of equity for interim financial statements. Under the amendments, an analysis of the changes in each caption of shareholders’ equity and noncontrolling interests presented in the balance sheet must be provided in a note or separate statement. The analysis must present a reconciliation of the beginning balance to the ending balance of each period for which a statement of earnings is required to be filed. The final rule was effective on November 5, 2018. The Company adopted the final rule effective for the first quarter of 2019. The adoption of the final rule did not have an impact on the Company’s consolidated financial position or results of operations.

In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (Topic 815). This ASU amends the guidance in ASC 815 to better align an entity’s risk management activities and financial reporting for hedging relationships

8

through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The guidance is effective for annual and interim reporting periods beginning after December 15, 2018, with early adoption permitted. The Company adopted ASU 2017-12 on January 1, 2019 and the standard did not have a material impact on its consolidated financial statements.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The ASU significantly changes the accounting model used by lessees to account for leases, requiring that all material leases be presented on the balance sheet. Lessees will recognize substantially all leases on the balance sheet as a right-of-use asset and a corresponding lease liability. The Company adopted ASU 2016-02 on January 1, 2019 utilizing the modified retrospective transition method and elected not to recast comparative periods. We elected the package of practical expedients, which allows the Company not to reassess (1) whether any expired or existing contracts as of the adoption date are or contain a lease, (2) lease classification for any expired or existing leases as of the adoption date and (3) initial direct costs for any existing leases as of the adoption date.  We also elected the practical expedient related to land easements, allowing us to carry forward our accounting treatment for land easements on existing agreements. The Company did not elect to apply the hindsight practical expedient when determining lease term and assessing impairment of right-of-use assets.

Adoption of ASU 2016-02 resulted in the recognition of right-of-use assets and lease liabilities for operating leases of $18.1 million on its consolidated balance sheet as of March 31, 2019, with no material impact on its consolidated statement of stockholders’ equity or consolidated statements of operations. See Note 9 for additional information and disclosure on our leases.

NRCG Merger

On June 23, 2019, US Ecology, Inc. entered into an Agreement and Plan of Merger (the “Merger Agreement”) with NRC Group Holdings Corp., a Delaware corporation (“NRCG”), US Ecology Parent, Inc., a Delaware corporation and wholly-owned subsidiary of the Company (“Holdco”), Rooster Merger Sub, Inc., a Delaware corporation and a wholly-owned subsidiary of Holdco (“Rooster Merger Sub”), and ECOL Merger Sub, Inc., a Delaware corporation and a wholly-owned subsidiary of Holdco (“ECOL Merger Sub”).

The Merger Agreement provides that, subject to the conditions set forth in the Merger Agreement, ECOL Merger Sub will merge with and into the Company, with the Company continuing as the surviving company and as a wholly-owned subsidiary of Holdco (the “Parent Merger”). Substantially concurrently therewith, NRCG Merger Sub will merge with and into NRCG, with NRCG continuing as the surviving company and as a wholly-owned subsidiary of Holdco (the “Rooster Merger,” and, together with the Parent Merger, the “Mergers”). The parties to the Merger Agreement intend that (1) each of the Mergers will qualify as a “reorganization” within the meaning of Section 368(a) of the Internal Revenue Code of 1986 (the “Code”), (2) the Mergers together will be treated as an “exchange” described in Section 351 of the Code, and (3) the Merger Agreement will constitute a “plan of reorganization” for purposes of Sections 354 and 361 of the Code.

In the Parent Merger, each share of common stock, par value $0.01 per share, of the Company (“Company Common Stock”) issued and outstanding immediately prior to the applicable Effective Time (other than cancelled shares) will be converted into the right to receive one share of common stock, par value $0.01 per share, of Holdco (“Holdco Common Stock”). Outstanding equity awards of the Company will be rolled into equity awards at Holdco on a one-for-one basis. Each share of Company Common Stock that is held by the Company as treasury stock or that is owned by the Company, ECOL Merger Sub, or any other subsidiary of the Company, immediately prior to the effective time of the Mergers (the “Effective Time”) will cease to be outstanding and will be cancelled and retired and will cease to exist, and no consideration will be delivered in exchange therefor.

In the Rooster Merger, each share of common stock, par value $0.0001 per share, of NRCG (“NRCG Common Stock”) issued and outstanding immediately prior to the applicable Effective Time (other than cancelled shares) will be converted into the right to receive, and become exchangeable for: (1) 0.196 shares (the “NRCG Exchange Ratio”) of Holdco Common Stock; (2) cash in lieu of fractional shares of Holdco Common Stock payable pursuant to the Merger Agreement; and (3) any dividends or other distributions to which the holder thereof becomes entitled to upon the surrender of such shares of NRCG Common Stock in accordance with the Merger Agreement. Outstanding shares of NRCG equity awards will be converted into equity awards of Holdco pursuant to the mechanics set forth in the Merger Agreement. In the Rooster

9

Merger, each share of NRCG Common Stock that is held by NRCG as treasury stock or that is owned by NRCG, Rooster Merger Sub or any other subsidiary of the Company or NRCG immediately prior to the applicable Effective Time will cease to be outstanding and will be cancelled and retired and will cease to exist, and no consideration will be delivered in exchange therefor.

In addition, in the Rooster Merger, each share of 7.00% Series A Convertible Cumulative Preferred Stock, par value $0.0001 per share, of NRCG (the “NRCG Series A Preferred Stock”) will be converted into, and become exchangeable for the right to receive that number of shares of Holdco Common Stock equal to (1) that number of shares of NRCG Common Stock that such share of NRCG Series A Preferred Stock could be converted into at the applicable Effective Time (including Fundamental Change Additional Shares and Accumulated Dividends (each, as defined in the Certificate of Designations, Preferences, Rights and Limitations of NRCG Series A Preferred Stock, dated as of October 17, 2018 and corrected on October 23, 2018 (the “NRCG Certificate of Designations”) establishing the rights of the NRCG Series A Preferred Stock)) multiplied by (b) the NRCG Exchange Ratio; (2) any cash in lieu of fractional shares of Holdco Common Stock payable pursuant to the Merger Agreement; and (3) any dividends or other distributions to which the holder thereof becomes entitled to upon the surrender of such shares of NRCG Common Stock in accordance with the Merger Agreement.

At the closing of the Rooster Merger, in respect of each outstanding warrant to purchase NRCG Common Stock (each, a “NRCG Warrant”) issued pursuant to that certain Warrant Agreement, dated as of June 22, 2017, between Continental Stock Transfer & Trust Company and NRCG, Holdco will issue a replacement warrant (each, a “Replacement Warrant”) to each holder providing that such Replacement Warrant will be exercisable for a number of shares of Holdco Common Stock equal to the product of (1) the number of shares of NRCG Common Stock that would have been issuable upon the exercise of the NRCG Warrant immediately prior to the effective time of the Rooster Merger and (2) the NRCG Exchange Ratio, at an exercise price equal to the quotient obtained by dividing (a) the pre-merger exercise price ($11.50 per share) by (b) the NRCG Exchange Ratio.

The closing of the Mergers, which is currently anticipated to occur during the fourth quarter of 2019, is subject to certain closing conditions, including (1) requisite approvals of the Company’s and NRCG’s stockholders, (2) the absence of certain legal impediments to the consummation of the Mergers, (3) the approval of the shares of Holdco Common Stock to be issued as consideration in the Mergers for listing on the Nasdaq Global Select Market, (4) effectiveness of the registration statement on Form S-4 registering the shares of Holdco Common Stock to be issued in connection with the Mergers, the Replacement Warrants and the shares of Holdco Common Stock underlying the Replacement Warrants, which includes a joint proxy statement of the Company and NRCG and a prospectus of Holdco (the “Proxy Statement”), (5) subject to certain exceptions, the accuracy of the representations, warranties and compliance with the covenants of each party to the Merger Agreement and (6) written tax opinions from the Company’s counsel and NRCG’s counsel.

NOTE 2.     REVENUES

Our operations are managed in two reportable segments, Environmental Services and Field & Industrial Services, reflecting our internal reporting structure and nature of services offered. See Note 17 for additional information on our operating segments.

Effective December 31, 2018, we changed our presentation of disaggregated revenues to align with changes in how we manage our service lines within our Field & Industrial Services segment. Revenues previously combined and reported as Technical Services are now disaggregated into two service lines, Small Quantity Generation (“SQG”) and Total Waste Management (“TWM”) and certain revenues formerly classified as Technical Services are now included in Remediation. Also, marine terminal services revenues, formerly classified as Other, are now included in Industrial Services. Effective January 1, 2019, Emergency Response revenues, formerly classified as Other, are now presented as a discrete service line. We also conformed the allocation of intercompany revenues between Treatment & Disposal Revenue and Services Revenue to be consistent across both segments. Throughout this Quarterly Report on Form 10-Q, our disaggregated revenues for all periods presented have been recast to reflect these changes.

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The following table presents our revenue disaggregated by our reportable segments and service lines:

	Three Months Ended June 30, 2019
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Total
Treatment & Disposal Revenue (1)	$	90,379	$	3,133	$	93,512
Services Revenue:
Transportation and Logistics (2)		22,465		12,760		35,225
Industrial Services (3)		—		4,963		4,963
Small Quantity Generation (4)		—		9,326		9,326
Total Waste Management (5)		—		8,004		8,004
Remediation (6)		—		889		889
Emergency Response (7)		—		3,180		3,180
Other (8)		—		703		703
Revenue	$	112,844	$	42,958	$	155,802

	Three Months Ended June 30, 2018
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Total
Treatment & Disposal Revenue (1)	$	78,093	$	2,902	$	80,995
Services Revenue:
Transportation and Logistics (2)		20,867		7,598		28,465
Industrial Services (3)		—		4,506		4,506
Small Quantity Generation (4)		—		9,138		9,138
Total Waste Management (5)		—		9,019		9,019
Remediation (6)		—		3,968		3,968
Emergency Response (7)		—		749		749
Other (8)		—		72		72
Revenue	$	98,960	$	37,952	$	136,912

	Six Months Ended June 30, 2019
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Total
Treatment & Disposal Revenue (1)	$	168,092	$	5,929	$	174,021
Services Revenue:
Transportation and Logistics (2)		37,085		19,852		56,937
Industrial Services (3)		—		10,980		10,980
Small Quantity Generation (4)		—		17,515		17,515
Total Waste Management (5)		—		16,719		16,719
Remediation (6)		—		2,616		2,616
Emergency Response (7)				6,226		6,226
Other (8)		—		1,825		1,825
Revenue	$	205,177	$	81,662	$	286,839

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	Six Months Ended June 30, 2018
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Total
Treatment & Disposal Revenue (1)	$	150,802	$	5,549	$	156,351
Services Revenue:
Transportation and Logistics (2)		34,629		13,248		47,877
Industrial Services (3)		—		8,385		8,385
Small Quantity Generation (4)		—		17,465		17,465
Total Waste Management (5)		—		19,241		19,241
Remediation (6)		—		6,158		6,158
Emergency Response (7)				1,391		1,391
Other (8)		—		103		103
Revenue	$	185,431	$	71,540	$	256,971

(1) We categorize our treatment and disposal revenue as either “Base Business” or “Event Business” based on the underlying nature of the revenue source. We define Event Business as non-recurring projects that are expected to equal or exceed 1,000 tons, with Base Business defined as all other business not meeting the definition of Event Business. For the three months ended June 30, 2019 and 2018, 23% and 19%, respectively, of our treatment and disposal revenue was derived from Event Business projects. Base Business revenue accounted for 77% and 81% of our treatment and disposal revenue for the three months ended June 30, 2019 and 2018, respectively. For the six months ended June 30, 2019 and 2018, 19% and 18%, respectively, of our treatment and disposal revenue was derived from Event Business projects. Base Business revenue accounted for 81% and 82% of our treatment and disposal revenue for the six months ended June 30, 2019 and 2018, respectively.

(2) Includes collection and transportation of non-hazardous and hazardous waste.

(3) Includes industrial cleaning and maintenance for refineries, chemical plants, steel and automotive plants, marine terminals and refinery services such as tank cleaning and temporary storage.

(4) Includes retail services, laboratory packing, less-than-truck-load service and household hazardous waste collection. Contracts for Small Quantity Generation may extend beyond one year and a portion of the transaction price can be fixed.

(5) Through our TWM program, customers outsource the management of their waste compliance program to us, allowing us to organize and coordinate their waste management disposal activities and environmental compliance. TWM contracts may extend beyond one year and a portion of the transaction price can be fixed.

(6) Includes site assessment, onsite treatment, project management and remedial action planning and execution. Contracts for Remediation may extend beyond one year and a portion of the transaction price can be fixed.

(7) Includes spill response, waste analysis and treatment and disposal planning.

(8) Includes equipment rental and other miscellaneous services.

We provide services in the United States and Canada. The following table presents our revenue disaggregated by our reportable segments and geographic location where the underlying services were performed:

	Three Months Ended June 30, 2019						Three Months Ended June 30, 2018
			Field &						Field &
	Environmental		Industrial				Environmental		Industrial
$s in thousands	Services		Services		Total		Services		Services		Total
United States	$	85,785	$	42,958	$	128,743	$	84,917	$	37,952	$	122,869
Canada		27,059		—		27,059		14,043		—		14,043
Total revenue	$	112,844	$	42,958	$	155,802	$	98,960	$	37,952	$	136,912

	Six Months Ended June 30, 2019						Six Months Ended June 30, 2018
			Field &						Field &
	Environmental		Industrial				Environmental		Industrial
$s in thousands	Services		Services		Total		Services		Services		Total
United States	$	163,144	$	81,662	$	244,806	$	159,903	$	71,540	$	231,443
Canada		42,033		—		42,033		25,528		—		25,528
Total revenue	$	205,177	$	81,662	$	286,839	$	185,431	$	71,540	$	256,971

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Deferred Revenue

We record deferred revenue when cash payments are received, or advance billings are charged, prior to performance of services. Deferred revenue includes waste that has been received but not yet treated or disposed, and is recognized when services are performed. We recognized $1.5 million of revenue during each of the three month periods ended June 30, 2019 and 2018 that was included in the deferred revenue balance at the beginning of each year. During the six months ended June 30, 2019 and 2018, we recognized $9.0 million and $7.8 million of revenue, respectively, that was included in the deferred revenue balance at the beginning of each year.

Receivables

Our receivables include invoiced and unbilled amounts where the Company has an unconditional right to payment.

Principal versus Agent Considerations

The Company commonly contracts with third-parties to perform certain waste-related services that we have promised in our customer contracts. We consider ourselves the principal in these arrangements as we direct the timing, nature and pricing of the services ultimately provided by the third-party to the customer.

Costs to obtain a contract

The Company pays sales commissions to employees, which qualify as costs to obtain a contract. Sales commissions are expensed as incurred as the commissions are earned by the employee and paid by the Company over time as the related revenue is recognized.

Practical Expedients and Optional Exemptions

Our payment terms may vary based on type of service or customer; however, we do not adjust the promised amount of consideration in our contracts for the time value of money as payment terms extended to our customers do not exceed one year and are not considered a significant financing component in our contracts.

We do not disclose the value of unsatisfied performance obligations as contracts with an original expected length of more than one year and contracts for which we do not recognize revenue at the amount to which we have the right to invoice for services performed is insignificant and the aggregate amount of fixed consideration allocated to unsatisfied performance obligations is not material.

NOTE 3.     BUSINESS COMBINATION

Ecoserv Industrial Disposal, LLC

On November 14, 2018, the Company acquired Ecoserv Industrial Disposal, LLC (“Winnie”), which provides non-hazardous industrial wastewater disposal solutions and employs deep-well injection technology in the southern United States.

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The following table summarizes the consideration paid for Winnie and the fair value estimates of assets acquired and liabilities assumed, recognized at the acquisition date, with purchase price allocation adjustments since the preliminary purchase price allocation as previously disclosed as of December 31, 2018:

	Purchase Price Allocation
	December 31,				June 30,
$s in thousands	2018		Adjustments		2019
Current assets	$	1,923	$	(63)	$	1,860
Property and equipment		6,300		(2,324)		3,976
Identifiable intangible assets		66,600		(100)		66,500
Current liabilities		(755)		—		(755)
Other liabilities		(512)		—		(512)
Total identifiable net assets		73,556		(2,487)		71,069
Goodwill		13,573		2,586		16,159
Total purchase price	$	87,129	$	99	$	87,228

Purchase price allocation adjustments relate primarily to the receipt of additional information regarding the fair values of property and equipment, a post-closing price adjustment based on working capital requirements and residual goodwill.

NOTE 4.     ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Changes in accumulated other comprehensive income (loss) (“AOCI”) consisted of the following:

	Foreign		Unrealized Gain
	Currency		(Loss) on Interest
$s in thousands	Translation		Rate Hedge		Total
Balance at December 31, 2018	$	(14,697)	$	906	$	(13,791)
Other comprehensive income (loss) before reclassifications, net of tax		3,369		(1,658)		1,711
Amounts reclassified out of AOCI, net of tax (1)		—		(210)		(210)
Other comprehensive income, net		3,369		(1,868)		1,501
Balance at June 30, 2019	$	(11,328)	$	(962)	$	(12,290)

(1) Before-tax reclassifications of $127,000 ($100,000 after-tax) and $266,000 ($210,000 after-tax) for the three and six months ended June 30, 2019, were included as a reduction of Interest expense in the Company’s consolidated statements of operations. Amounts relate to the Company’s interest rate swap which is designated as a cash flow hedge. Changes in fair value of the swap recognized in AOCI are reclassified to interest expense when hedged interest payments on the underlying long-term debt are made. Amounts in AOCI expected to be recognized as a reduction of interest expense over the next 12 months total approximately $509,000 ($402,000 after-tax).

	Foreign		Unrealized Gain
	Currency		(Loss) on Interest
$s in thousands	Translation		Rate Hedge		Total
Balance at December 31, 2017	$	(8,603)	$	(501)	$	(9,104)
Other comprehensive income (loss) before reclassifications, net of tax		(3,468)		1,913		(1,555)
Amounts reclassified out of AOCI, net of tax (2)		—		310		310
Other comprehensive income, net		(3,468)		2,223		(1,245)
Balance at June 30, 2018	$	(12,071)	$	1,722	$	(10,349)

(2) Before-tax reclassifications of $119,000 ($94,000 after-tax) and $392,000 ($310,000 after-tax) for the three and six months ended June 30, 2018, were included in Interest expense in the Company’s consolidated statements of operations. Amounts relate to the Company’s interest rate swap which is designated as a cash flow hedge. Changes in fair value of the swap recognized in AOCI are reclassified to interest expense when hedged interest payments on the underlying long-term debt are made.

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NOTE 5.     CONCENTRATIONS AND CREDIT RISK

Major Customers

No customer accounted for more than 10% of total revenue for the three or six months ended June 30, 2019 or 2018, respectively. No customer accounted for more than 10% of total trade receivables as of June 30, 2019 or December 31, 2018.

Credit Risk Concentration

We maintain most of our cash and cash equivalents with nationally recognized financial institutions. Substantially all balances are uninsured and are not used as collateral for other obligations. Concentrations of credit risk on accounts receivable are believed to be limited due to the number, diversification and character of the obligors and our credit evaluation process.

NOTE 6.     RECEIVABLES

Receivables consisted of the following:

	June 30,		December 31,
$s in thousands	2019		2018
Trade	$	115,935	$	118,909
Unbilled revenue		27,741		26,538
Other		8,887		2,241
Total receivables		152,563		147,688
Allowance for doubtful accounts		(2,526)		(2,998)
Receivables, net	$	150,037	$	144,690

NOTE 7.     FAIR VALUE MEASUREMENTS

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities recorded at fair value are categorized using defined hierarchical levels directly related to the amount of subjectivity associated with the inputs to fair value measurements, as follows:

Level 1 - Quoted prices in active markets for identical assets or liabilities;

Level 2 - Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable;

Level 3 - Unobservable inputs in which little or no market activity exists, requiring an entity to develop its own assumptions that market participants would use to value the asset or liability.

The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, restricted cash and investments, accounts payable, accrued liabilities, debt and interest rate swap agreements. The estimated fair value of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their carrying value due to the short-term nature of these instruments.

The Company estimates the fair value of its variable-rate debt using Level 2 inputs, such as interest rates, related terms and maturities of similar obligations. At June 30, 2019, the carrying value of the Company’s variable-rate debt approximates fair value due to the short-term nature of the interest rates.

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The Company’s assets and liabilities measured at fair value on a recurring basis consisted of the following:

	June 30, 2019
	Quoted Prices in		Other Observable		Unobservable
	Active Markets		Inputs		Inputs
$s in thousands	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Fixed-income securities (1)	$	1,979	$	2,224	$	—	$	4,203
Money market funds (2)		818		—		—		818
Total	$	2,797	$	2,224	$	—	$	5,021
Liabilities:
Interest rate swap agreement (3)	$	—	$	1,217	$	—	$	1,217
Total	$	—	$	1,217	$	—	$	1,217

	December 31, 2018
	Quoted Prices in		Other Observable		Unobservable
	Active Markets		Inputs		Inputs
$s in thousands	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Fixed-income securities (1)	$	1,561	$	2,596	$	—	$	4,157
Money market funds (2)		784		—		—		784
Interest rate swap agreement (3)		—		1,147				1,147
Total	$	2,345	$	3,743	$	—	$	6,088

(1) We invest a portion of our Restricted cash and investments in fixed-income securities, including U.S. Treasury and U.S. agency securities. We measure the fair value of U.S. Treasury securities using quoted prices for identical assets in active markets. We measure the fair value of U.S. agency securities using observable market activity for similar assets. The fair value of our fixed-income securities approximates our cost basis in the investments.

(2) We invest a portion of our Restricted cash and investments in money market funds. We measure the fair value of these money market fund investments using quoted prices for identical assets in active markets. Money market funds are considered restricted cash for purposes of reconciling the beginning-of-period and end-of-period amounts presented in the Company’s consolidated statements of cash flows.

(3) In order to manage interest rate exposure, we entered into an interest rate swap agreement in October 2014 that effectively converts a portion of our variable-rate debt to a fixed interest rate. The swap is designated as a cash flow hedge, with gains and losses deferred in other comprehensive income to be recognized as an adjustment to interest expense in the same period that the hedged interest payments affect earnings. The interest rate swap has an effective date of December 31, 2014 with an initial notional amount of $250.0 million. The fair value of the interest rate swap agreement represents the difference in the present value of cash flows calculated at the contracted interest rates and at current market interest rates at the end of the period. We calculate the fair value of the interest rate swap agreement quarterly based on the quoted market price for the same or similar financial instruments. The fair value of the interest rate swap agreement is included in Other long-term liabilities and Other assets in the Company’s consolidated balance sheet as of June 30, 2019 and December 31, 2018, respectively.

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NOTE 8.     PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:

	June 30,		December 31,
$s in thousands	2019		2018
Cell development costs	$	147,059	$	146,155
Land and improvements		53,067		50,481
Buildings and improvements		91,743		91,358
Railcars		17,299		17,299
Vehicles and other equipment		162,388		154,014
Construction in progress		26,546		14,554
Total property and equipment		498,102		473,861
Accumulated depreciation and amortization		(232,482)		(215,418)
Property and equipment, net	$	265,620	$	258,443

Depreciation and amortization expense for the three months ended June 30, 2019 and 2018 was $9.1 million and $7.0 million, respectively. Depreciation and amortization expense for the six months ended June 30, 2019 and 2018 was $17.3 million and $13.6 million, respectively.

NOTE 9.   LEASES

We lease certain facilities, office space, land and equipment. Our lease payments are primarily fixed, but also include variable payments that are based on usage of the leased asset. Initial lease terms range from one to 15 years, and may include one or more options to renew, with renewal terms extending a lease up to 40 years. None of our renewal options are considered reasonably certain to be exercised. Provisions for residual value guarantees exist in some of our equipment leases, however amounts associated with these provisions are not material. Our leases do not include any material restrictive covenants.

Leases with an initial term of 12 months or less are not recorded on the balance sheet and expense is recognized on a straight-line basis over the lease term. We combine lease and nonlease components in our leases, except for equipment leases that include maintenance related services. We use the rate implicit in the lease, when available, to discount lease payments to present value. However, many of our leases do not provide a readily determinable implicit rate and we estimate our incremental borrowing rate to discount payments based on information available at lease commencement.

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Lease assets and liabilities consisted of the following:

$s in thousands	June 30, 2019
Assets:
Operating right-of-use assets (1)	$	17,575
Finance right-of-use assets (2)		3,028
Total	$	20,603
Liabilities:
Current:
Operating (3)	$	4,932
Finance (4)		837
Long-term:
Operating (5)		12,553
Finance (6)		2,269
Total	$	20,591

(1) Included in Operating lease assets in the Company’s consolidated balance sheets.

(2) Included in Property and equipment, net in the Company’s consolidated balance sheets. Finance right-of-use assets are recorded net of accumulated amortization of $1.5 million as of June 30, 2019.

(3) Included in Current portion of operating lease liabilities in the Company’s consolidated balance sheets.

(4) Included in Accrued liabilities in the Company’s consolidated balance sheets.

(5) Included in Long-term operating lease liabilities in the Company’s consolidated balance sheets.

(6) Included in Other long-term liabilities in the Company’s consolidated balance sheets.

Lease expense consisted of the following:

	Three Months Ended		Six Months Ended
$s in thousands	June 30, 2019		June 30, 2019
Operating lease cost (1)	$	1,713	$	3,455
Finance lease cost:
Amortization of leased assets (2)		248		476
Interest on lease liabilities (3)		30		50
Total	$	1,991	$	3,981

(1) Included in Direct operating costs and Selling, general, and administrative expenses in the Company’s consolidated statements of operations. Operating lease cost includes short-term leases, excluding expenses relating to leases with a term of one month or less, which are not material. Operating lease cost excludes variable lease costs which are not material.

(2) Included in Direct operating costs in the Company’s consolidated statements of operations.

(3) Included in Interest expense in the Company’s consolidated statements of operations.

Supplemental cash flow information related to our leases is as follows:

	Six Months Ended
$s in thousands	June 30, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	3,238
Operating cash flows from finance leases		50
Financing cash flows from finance leases		408
Non-cash investing and financing activities:
Right-of-use assets obtained in exchange for new operating lease liabilities	$	2,397
Right-of-use assets obtained in exchange for new finance lease liabilities		1,844

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Other information related to our leases is as follows:

	June 30, 2019
Weighted-average remaining lease term (years):
Operating leases		5.6
Finance leases		3.7
Weighted-average discount rate:
Operating leases		4.38	%
Finance leases		3.71	%

The Company’s maturity analysis of its lease liabilities as of June 30, 2019 is as follows:

	Operating		Finance
$s in thousands	Leases		Leases		Total
2019 (excluding the six months ended June 30, 2019)	$	2,936	$	484	$	3,420
2020		4,110		792		4,902
2021		3,663		619		4,282
2022		2,367		548		2,915
2023		1,886		612		2,498
Thereafter		5,157		354		5,511
Total	$	20,119	$	3,409	$	23,528
Less: Interest		2,634		303		2,937
Present value of lease liabilities	$	17,485	$	3,106	$	20,591

Future minimum lease payments on non-cancellable operating leases as of December 31, 2018 are as follows:

$s in thousands	Payments
2019	$	5,638
2020		3,644
2021		3,184
2022		1,885
2023		1,457
Thereafter		5,065
	$	20,873

NOTE 10.     GOODWILL AND INTANGIBLE ASSETS

Changes in goodwill for the six months ended June 30, 2019 consisted of the following:

					Field &
	Environmental				Industrial
	Services				Services
			Accumulated				Accumulated
$s in thousands	Gross		Impairment		Gross		Impairment		Total
Balance at December 31, 2018	$	162,816	$	(6,870)	$	51,231	$	—	$	207,177
Winnie purchase price allocation adjustment		2,586		—		—		—		2,586
Foreign currency translation		703		—		—		—		703
Balance at June 30, 2019	$	166,105	$	(6,870)	$	51,231	$	—	$	210,466

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Intangible assets, net consisted of the following:

	June 30, 2019						December 31, 2018
			Accumulated						Accumulated
$s in thousands	Cost		Amortization		Net		Cost		Amortization		Net
Amortizing intangible assets:
Permits, licenses and lease	$	165,600	$	(16,817)	$	148,783	$	164,840	$	(14,804)	$	150,036
Customer relationships		99,396		(28,948)		70,448		99,241		(25,676)		73,565
Technology - formulae and processes		6,951		(1,897)		5,054		6,672		(1,714)		4,958
Customer backlog		3,652		(1,839)		1,813		3,652		(1,656)		1,996
Developed software		2,894		(1,737)		1,157		2,884		(1,581)		1,303
Non-compete agreements		1,542		(1,076)		466		1,542		(875)		667
Internet domain and website		536		(142)		394		536		(128)		408
Database		387		(181)		206		384		(167)		217
Total amortizing intangible assets		280,958		(52,637)		228,321		279,751		(46,601)		233,150
Non-amortizing intangible assets:
Permits and licenses		46,415		—		46,415		46,391		—		46,391
Tradename		130		—		130		125		—		125
Total intangible assets	$	327,503	$	(52,637)	$	274,866	$	326,267	$	(46,601)	$	279,666

Amortization expense for the three months ended June 30, 2019 and 2018 was $2.9 million and $2.3 million, respectively. Amortization expense for the six months ended June 30, 2019 and 2018 was $5.7 million and $4.6 million, respectively. Foreign intangible asset carrying amounts are affected by foreign currency translation.

NOTE 11.     DEBT

Long-term debt consisted of the following:

	June 30,		December 31,
$s in thousands	2019		2018
Revolving credit facility	$	334,000	$	364,000
Long-term debt	$	334,000	$	364,000

2017 Credit Agreement

On April 18, 2017, the Company entered into a senior secured credit agreement (the “2017 Credit Agreement”) with Wells Fargo Bank, National Association (“Wells Fargo”), as administrative agent for the lenders, swingline lender and issuing lender, and Bank of America, N.A., as an issuing lender, that provides for a $500.0 million, five-year revolving credit facility (the “Revolving Credit Facility”), including a $75.0 million sublimit for the issuance of standby letters of credit and a $25.0 million sublimit for the issuance of swingline loans used to fund short-term working capital requirements. The 2017 Credit Agreement also contains an accordion feature whereby the Company may request up to $200.0 million of additional funds through an increase to the Revolving Credit Facility, through incremental term loans, or some combination thereof. The Company is pursuing an amendment to the 2017 Credit Agreement to, among other things, permit a $400.0 million term loan, which the Company intends to use in refinancing existing indebtedness of NRCG in connection with the Mergers and to pay the fees and expenses of the Company incurred in connection with the Mergers and the transactions in connection therewith.

The Revolving Credit Facility provides up to $500.0 million of revolving credit loans or letters of credit with the use of proceeds restricted solely for working capital and other general corporate purposes (including acquisitions and capital expenditures). Under the Revolving Credit Facility, revolving credit loans are available based on a base rate (as defined in the 2017 Credit Agreement) or LIBOR, at the Company’s option, plus an applicable margin which is determined according to a pricing grid under which the interest rate decreases or increases based on our ratio of funded debt to consolidated

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earnings before interest, taxes, depreciation and amortization (as defined in the 2017 Credit Agreement), as set forth in the table below:

Total Net Leverage Ratio	LIBOR Rate Loans Interest Margin	Base Rate Loans Interest Margin
Equal to or greater than 3.25 to 1.00	2.00%	1.00%
Equal to or greater than 2.50 to 1.00, but less than 3.25 to 1.00	1.75%	0.75%
Equal to or greater than 1.75 to 1.00, but less than 2.50 to 1.00	1.50%	0.50%
Equal to or greater than 1.00 to 1.00, but less than 1.75 to 1.00	1.25%	0.25%
Less than 1.00 to 1.00	1.00%	0.00%

At June 30, 2019, the effective interest rate on the Revolving Credit Facility, after giving effect to the impact of our interest rate swap, was 3.61%. Interest only payments are due either quarterly or on the last day of any interest period, as applicable.

In October 2014, the Company entered into an interest rate swap agreement, effectively fixing the interest rate on $160.0 million, or 48%, of the Revolving Credit Facility borrowings as of June 30, 2019.

The Company is required to pay a commitment fee ranging from 0.175% to 0.35% on the average daily unused portion of the Revolving Credit Facility, with such commitment fee to be reduced based upon the Company’s total net leverage ratio (as defined in the 2017 Credit Agreement). The maximum letter of credit capacity under the Revolving Credit Facility is $75.0 million and the 2017 Credit Agreement provides for a letter of credit fee equal to the applicable margin for LIBOR loans under the Revolving Credit Facility. At June 30, 2019, there were $334.0 million of revolving credit loans outstanding on the Revolving Credit Facility. These revolving credit loans are due upon the earliest to occur of (a) April 18, 2022 (or, with respect to any lender, such later date as requested by us and accepted by such lender), (b) the date of termination of the entire revolving credit commitment (as defined in the 2017 Credit Agreement) by us, and (c) the date of termination of the revolving credit commitment and are presented as long-term debt in the consolidated balance sheets.  

The Company has entered into a sweep arrangement whereby day-to-day cash requirements in excess of available cash balances are advanced to the Company on an as-needed basis with repayments of these advances automatically made from subsequent deposits to our cash operating accounts (the “Sweep Arrangement”). Total advances outstanding under the Sweep Arrangement are subject to the $25.0 million swingline loan sublimit under the Revolving Credit Facility. The Company’s revolving credit loans outstanding under the Revolving Credit Facility are not subject to repayment through the Sweep Arrangement. As of June 30, 2019, there were no amounts outstanding subject to the Sweep Arrangement.

As of June 30, 2019, the availability under the Revolving Credit Facility was $160.3 million with $5.7 million of the Revolving Credit Facility issued in the form of standby letters of credit utilized as collateral for closure and post-closure financial assurance and other assurance obligations.

The Company may at any time and from time to time prepay revolving credit loans and swingline loans, in whole or in part, without premium or penalty, subject to the obligation to indemnify each of the lenders against any actual loss or expense (including any loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain a LIBOR rate loan (as defined in the 2017 Credit Agreement) or from fees payable to terminate the deposits from which such funds were obtained) with respect to the early termination of any LIBOR rate loan. The 2017 Credit Agreement provides for mandatory prepayment at any time if the revolving credit outstanding exceeds the revolving credit commitment (as such terms are defined in the 2017 Credit Agreement), in an amount equal to such excess. Subject to certain exceptions, the 2017 Credit Agreement provides for mandatory prepayment upon certain asset dispositions, casualty events and issuances of indebtedness.

Pursuant to (i) an unconditional guarantee agreement and (ii) a collateral agreement, each entered into by the Company and its domestic subsidiaries on April 18, 2017, the Company’s obligations under the 2017 Credit Agreement are (or will be) jointly and severally and fully and unconditionally guaranteed on a senior basis by all of the Company’s existing and certain future domestic subsidiaries and are secured by substantially all of the assets of the Company and the Company’s existing and certain future domestic subsidiaries (subject to certain exclusions), including 100% of the equity interests of

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the Company’s domestic subsidiaries and 65% of the voting equity interests of the Company’s directly owned foreign subsidiaries (and 100% of the non-voting equity interests of the Company’s directly owned foreign subsidiaries).

The 2017 Credit Agreement contains customary restrictive covenants, subject to certain permitted amounts and exceptions, including covenants limiting the ability of the Company to incur additional indebtedness, pay dividends and make other restricted payments, repurchase shares of our outstanding stock and create certain liens. Upon the occurrence of an event of default (as defined in the 2017 Credit Agreement), among other things, amounts outstanding under the 2017 Credit Agreement may be accelerated and the commitments may be terminated.

The 2017 Credit Agreement also contains financial maintenance covenants, a maximum consolidated total net leverage ratio and a consolidated interest coverage ratio (as such terms are defined in the 2017 Credit Agreement). Our consolidated total net leverage ratio as of the last day of any fiscal quarter may not exceed 3.50 to 1.00, subject to certain exceptions. Our consolidated interest coverage ratio as of the last day of any fiscal quarter may not be less than 3.00 to 1.00.

At June 30, 2019, we were in compliance with all of the financial covenants in the 2017 Credit Agreement.

NOTE 12.     CLOSURE AND POST-CLOSURE OBLIGATIONS

Our accrued closure and post-closure liability represents the expected future costs, including corrective actions, associated with closure and post-closure of our operating and non-operating disposal facilities. We record the fair value of our closure and post-closure obligations as a liability in the period in which the regulatory obligation to retire a specific asset is triggered. For our individual landfill cells, the required closure and post-closure obligations under the terms of our permits and our intended operation of the landfill cell are triggered and recorded when the cell is placed into service and waste is initially disposed in the landfill cell. The fair value is based on the total estimated costs to close the landfill cell and perform post-closure activities once the landfill cell has reached capacity and is no longer accepting waste. We perform periodic reviews of both non-operating and operating facilities and revise accruals for estimated closure and post-closure, remediation or other costs as necessary. Recorded liabilities are based on our best estimates of current costs and are updated periodically to include the effects of existing technology, presently enacted laws and regulations, inflation and other economic factors.

Changes to closure and post-closure obligations consisted of the following:

	Three Months Ended		Six Months Ended
$s in thousands	June 30, 2019		June 30, 2019
Closure and post-closure obligations, beginning of period	$	79,056	$	78,363
Accretion expense		1,133		2,258
Payments		(305)		(775)
Foreign currency translation		35		73
Closure and post-closure obligations, end of period		79,919		79,919
Less current portion		(2,231)		(2,231)
Long-term portion	$	77,688	$	77,688

NOTE 13.   INCOME TAXES

Our effective tax rate for the three months ended June 30, 2019 was 29.2%, up from 24.4% for the three months ended June 30, 2018. Our effective tax rate for the six months ended June 30, 2019 was 28.6%, up from 25.7% for the six months ended June 30, 2018. The increase for the three and six months ended June 30, 2019, compared to the three and six months ended June 30, 2018, was primarily due to increased non-deductible expenses and higher effective state tax rates, partially offset by federal research and development credits. The change in the effective tax rate for the three and six months ended June 30, 2019 also reflects the impact of discrete events including the recognition of excess tax benefits related to employee stock compensation.

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Gross unrecognized tax benefits, included in Other long-term liabilities in the consolidated balance sheets, were $616,000 and $555,000 as of June 30, 2019 and December 31, 2018, respectively. The gross unrecognized tax benefits, if recognized by the Company, will result in a reduction of approximately $544,000 to the provision for income taxes thereby favorably impacting the Company’s effective tax rate. We do not anticipate our total unrecognized tax benefits to increase or decrease materially within the next twelve months. We recognize interest assessed by taxing authorities or interest associated with uncertain tax positions as a component of interest expense. We recognize any penalties assessed by taxing authorities or penalties associated with uncertain tax positions as a component of Selling, general and administrative expenses.

We file a consolidated U.S. federal income tax return with the Internal Revenue Service (“IRS”) as well as tax returns in various states, Canada, and Mexico. The Company is subject to examination by the IRS for tax years 2014 through 2018. The Company is currently under examination by the state of Idaho for years 2014 through 2018 and the state of Texas for the year 2014. We may be subject to examinations by various state and local taxing jurisdictions for tax years 2014 through 2018. The Company has no significant foreign jurisdiction audits underway. The tax years 2014 through 2018 remain subject to examination by foreign jurisdictions.

NOTE 14.   EARNINGS PER SHARE

	Three Months Ended June 30,
	2019				2018
$s and shares in thousands, except per share amounts	Basic		Diluted		Basic		Diluted
Net income	$	15,491	$	15,491	$	13,220	$	13,220
Weighted average basic shares outstanding		22,006		22,006		21,867		21,867
Dilutive effect of share-based awards				202				157
Weighted average diluted shares outstanding				22,208				22,024
Earnings per share	$	0.70	$	0.70	$	0.60	$	0.60
Anti-dilutive shares excluded from calculation				92				58

	Six Months Ended June 30,
	2019				2018
$s and shares in thousands, except per share amounts	Basic		Diluted		Basic		Diluted
Net income	$	23,534	$	23,534	$	22,463	$	22,463
Weighted average basic shares outstanding		21,997		21,997		21,835		21,835
Dilutive effect of share-based awards				206				156
Weighted average diluted shares outstanding				22,203				21,991
Earnings per share	$	1.07	$	1.06	$	1.03	$	1.02
Anti-dilutive shares excluded from calculation				86				76

NOTE 15.   EQUITY

Stock Repurchase Program

On June 1, 2016, the Company’s Board of Directors authorized the repurchase of $25.0 million of the Company’s outstanding common stock. Repurchases may be made from time to time in the open market or through privately negotiated transactions. The timing of any repurchases will be based upon prevailing market conditions and other factors. The Company did not repurchase any shares of common stock under the repurchase program during the three or six months ended June 30, 2019. On May 29, 2018 the repurchase program was extended and will remain in effect until June 6, 2020, unless further extended by our Board of Directors.

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Omnibus Incentive Plan

On May 27, 2015, our stockholders approved the Omnibus Incentive Plan (“Omnibus Plan”), which was approved by our Board of Directors on April 7, 2015. The Omnibus Plan was developed to provide additional incentives through equity ownership in the Company and, as a result, encourage employees and directors to contribute to our success. The Omnibus Plan provides, among other things, the ability for the Company to grant restricted stock, performance stock, options, stock appreciation rights, restricted stock units (“RSUs”), performance stock units (“PSUs”) and other share-based awards or cash awards to officers, employees, consultants and non-employee directors. Subsequent to the approval of the Omnibus Plan in May 2015, we stopped granting equity awards under our 2008 Stock Option Incentive Plan and our 2006 Restricted Stock Plan (collectively, the “Previous Plans”). The Previous Plans will remain in effect solely for the settlement of awards granted under the Previous Plans. No shares that are reserved but unissued under the Previous Plans or that are outstanding under the Previous Plans and reacquired by the Company for any reason will be available for issuance under the Omnibus Plan. The Omnibus Plan expires on April 7, 2025 and authorizes 1,500,000 shares of common stock for grant over the life of the Omnibus Plan. As of June 30, 2019, 873,117 shares of common stock remain available for grant under the Omnibus Plan.

PSUs, RSUs and Restricted Stock

On March 1, 2019, the Company granted 17,111 PSUs to certain employees. Each PSU represents the right to receive, on the settlement date, one share of the Company’s common stock. The total number of PSUs each participant is eligible to earn ranges from 0% to 300% of the target number of PSUs granted. The actual number of PSUs that will vest and be settled in shares is determined at the end of a three-year performance period beginning January 1, 2019, based on adjusted earnings per share and return on invested capital relative to established targets with an additional adjustment based on total stockholder return relative to a set of peer companies. The fair value of the PSUs estimated on the grant date using a Monte Carlo simulation was $58.20 per unit. Compensation expense is recorded over the awards’ vesting period.

Assumptions used in the Monte Carlo simulation to calculate the fair value of the PSUs granted in 2019 are as follows:

	2019
Stock price on grant date	$	58.40
Expected term		3.0	years
Expected volatility		30	%
Risk-free interest rate		2.5	%
Expected dividend yield		1.1	%

A summary of our PSU, restricted stock and RSU activity for the six months ended June 30, 2019 is as follows:

	PSUs			Restricted Stock			RSUs
		Weighted			Weighted			Weighted
		Average			Average			Average
		Grant Date			Grant Date			Grant Date
	Shares	Fair Value		Shares	Fair Value		Shares	Fair Value
Outstanding as of December 31, 2018	39,200	$	55.48	74,988	$	46.74	66,785	$	53.77
Granted	17,111		58.20	27,800		62.59	33,020		56.21
Vested	(13,600)		41.22	(39,234)		43.77	(26,362)		48.28
Cancelled, expired or forfeited	—		—	—		—	(243)		45.66
Outstanding as of June 30, 2019	42,711	$	61.11	63,554	$	55.50	73,200	$	56.88

During the six months ended June 30, 2019, 13,600 PSUs vested and PSU holders earned 19,414 shares of the Company’s common stock.

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Stock Options

A summary of our stock option activity for the six months ended June 30, 2019 is as follows:

		Weighted
		Average
		Exercise
	Shares	Price
Outstanding as of December 31, 2018	236,503	$	44.93
Granted	41,100		63.36
Exercised	(3,246)		42.29
Cancelled, expired or forfeited	(1,540)		43.55
Outstanding as of June 30, 2019	272,817	$	47.74
Exercisable as of June 30, 2019	191,756	$	43.83

During the six months ended June 30, 2019, option holders tendered 2,252 options in connection with options exercised via net share settlement.

Treasury Stock

During the six months ended June 30, 2019, the Company repurchased 14,462 shares of the Company’s common stock in connection with the net share settlement of employee equity awards at an average cost of $63.34 per share. During the six months ended June 30, 2019, the Company issued 7,800 treasury shares related to restricted stock awards at an average cost of $57.77 per share.

Dividends

The Company paid dividends of $0.18 per common share during each of the three months ended June 30, 2019 and 2018 and paid dividends of $0.36 per common share during each of the six months ended June 30, 2019 and 2018.

NOTE 16.   COMMITMENTS AND CONTINGENCIES

Litigation and Regulatory Proceedings

In the ordinary course of business, we are involved in judicial and administrative proceedings involving federal, state, provincial or local governmental authorities, including regulatory agencies that oversee and enforce compliance with permits. Fines or penalties may be assessed by our regulators for non-compliance. Actions may also be brought by individuals or groups in connection with permitting of planned facilities, modification or alleged violations of existing permits, or alleged damages suffered from exposure to hazardous substances purportedly released from our operated sites, as well as other litigation. We maintain insurance intended to cover property and damage claims asserted as a result of our operations. Periodically, management reviews and may establish reserves for legal and administrative matters, or other fees expected to be incurred in relation to these matters.

On July 23, 2019, SBTS, LLC (“SBTS”) filed a complaint captioned SBTS, LLC vs. NRC Group Holdings Corp. (Civil Action No. 2019-0566-JTL), in the Court of Chancery of the State of Delaware (the “Court of Chancery”) against NRCG, NRC Group and US Ecology (the “Complaint”). In the Complaint, SBTS alleges that (1) the exchange (the “Preferred Exchange”) of the NRCG Series A Preferred Stock pursuant to the Merger Agreement breaches certain provisions of the NRCG Series A Certificate of Designations, (2) the Preferred Exchange would violate Section 242 of the Delaware General Corporation Law (“DGCL”), (3) SBTS would suffer irreparable harm if NRCG and US Ecology are not enjoined from consummating the transactions contemplated by the Merger Agreement and (4) US Ecology had knowledge of the relevant sections of the NRCG Series A Certificate of Designations and still required the Merger Agreement to include the Preferred Exchange.

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In the Complaint, SBTS requests that the Court of Chancery (1) render a declaratory judgment that (a) the terms of the Merger Agreement violate certain provisions of the NRCG Series A Certificate of Designations, (b) the removal of the NRCG Series A Preferred Stock designee from the NRCG Board violates NRCG’s Certificate of Incorporation and the NRCG Series A Certificate of Designations, and (c) the terms of the Merger Agreement violate Section 242 of the DGCL, (2) enjoin NRCG from convening a vote of its common stockholders to adopt the Merger Agreement, (3) enjoin NRCG and US Ecology from consummating the transactions contemplated by the Merger Agreement, (4) find US Ecology liable for tortious interference with a contract and award SBTS the damages caused by US Ecology’s actions, (5) award SBTS costs and expenses in connection with the action and (6) grant SBTS any such further relief as justice and its cause may require.

As previously disclosed, NRCG and US Ecology believe that the allegations in the Complaint are without merit and that the Preferred Exchange of the NRCG Series A Preferred Stock as contemplated in the Merger Agreement is in accordance with the NRCG Series A Certificate of Designations and the DGCL.

On November 17, 2018, an explosion occurred at our Grand View, Idaho facility, resulting in one employee fatality and injuries to other employees. The incident severely damaged the facility’s primary waste-treatment building as well as surrounding waste handling, waste storage, maintenance and administrative support structures, resulting in the closure of the entire facility that remained in effect through January 2019. We resumed landfill operations at our Grand View, Idaho facility in first quarter of 2019 and resumed operations of our secondary waste-treatment facility in the second quarter of 2019. Reconstruction of the primary waste-treatment building is currently underway. In addition to conducting our own investigation into the incident, we are fully cooperating with government agencies, including Idaho Department of Environmental Quality (“IDEQ”) and the U.S. Environmental Protection Agency (“USEPA”) to support their comprehensive and independent investigations of the incident. We cannot presently estimate the potential liability related to the incident and, therefore, no amounts related to such claims have been recorded in our financial statements as of June 30, 2019. We have not been named as a defendant in any civil action relating to the incident. As a result of the Occupational Safety and Health Administration’s (“OSHA”) inspection following the incident, OSHA issued a Citation and Notification of Penalty on May 6, 2019. We are currently contesting the Citation and Notification of Penalty before the Occupational Safety and Health Review Commission and the contested penalty is not material. We maintain workers’ compensation insurance, business interruption insurance and liability insurance for personal injury, property and casualty damage. We believe that any potential third-party claims associated with the explosion, in excess of our deductibles, are expected to be resolved primarily through our insurance policies. Although we carry business interruption insurance, a disruption of our business caused by a casualty event, including the full and partial closure of our Grand View, Idaho facility, may result in the loss of business, profits or customers during the time of such closure. Accordingly, our insurance policies may not fully compensate us for these losses.

The Company received $9.5 million of property-related insurance payments in the first six months of 2019 related to the incident at our Grand View, Idaho facility in the fourth quarter of 2018. The Company recognized $9.2 million of property-related insurance recovery gains in the first six months of 2019. The Company is actively working with its insurance companies on comprehensive property and business interruption insurance claims. Although the Company has recognized certain insurance recoveries related to expenses incurred to continue limited operations at the facility, as of June 30, 2019, the Company has neither received nor recognized any business interruption insurance recoveries related to lost profits as a result of lost business or customers.

Other than as described above, we are not currently a party to any material pending legal proceedings and are not aware of any other claims that could, individually or in the aggregate, have a materially adverse effect on our financial position, results of operations or cash flows.

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NOTE 17.   OPERATING SEGMENTS

Financial Information by Segment

Our operations are managed in two reportable segments reflecting our internal reporting structure and nature of services offered as follows:

Environmental Services - This segment provides a broad range of hazardous material management services including transportation, recycling, treatment and disposal of hazardous, non-hazardous and radioactive waste at Company-owned landfill, wastewater, deep-well injection and other treatment facilities.

Field & Industrial Services - This segment provides packaging and collection of hazardous waste and total waste management solutions at customer sites and through our 10-day transfer facilities. Services include on-site management, waste characterization, transportation and disposal of non-hazardous and hazardous waste. This segment also provides specialty field services such as industrial cleaning and maintenance, remediation, lab packs, retail services, transportation, emergency response and other services to commercial and industrial facilities and to government entities.

The operations not managed through our two reportable segments are recorded as “Corporate.” Corporate selling, general and administrative expenses include typical corporate items such as legal, accounting and other items of a general corporate nature. Income taxes are assigned to Corporate, but all other items are included in the segment where they originated. Inter-company transactions have been eliminated from the segment information and are not significant between segments.

Summarized financial information of our reportable segments is as follows:

	Three Months Ended June 30, 2019
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Corporate		Total
Revenue	$	112,844	$	42,958	$	—	$	155,802
Depreciation, amortization and accretion	$	10,377	$	2,151	$	597	$	13,125
Capital expenditures	$	14,455	$	2,059	$	920	$	17,434
Total assets	$	725,311	$	167,985	$	68,120	$	961,416

	Three Months Ended June 30, 2018
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Corporate		Total
Revenue	$	98,960	$	37,952	$	—	$	136,912
Depreciation, amortization and accretion	$	8,676	$	1,415	$	330	$	10,421
Capital expenditures	$	4,935	$	1,849	$	618	$	7,402
Total assets	$	599,706	$	126,797	$	98,160	$	824,663

	Six Months Ended June 30, 2019
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Corporate		Total
Revenue	$	205,177	$	81,662	$	—	$	286,839
Depreciation, amortization and accretion	$	20,003	$	4,282	$	901	$	25,186
Capital expenditures	$	21,296	$	2,108	$	1,253	$	24,657
Total assets	$	725,311	$	167,985	$	68,120	$	961,416

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	Six Months Ended June 30, 2018
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Corporate		Total
Revenue	$	185,431	$	71,540	$	—	$	256,971
Depreciation, amortization and accretion	$	17,186	$	2,770	$	446	$	20,402
Capital expenditures	$	10,939	$	2,887	$	1,134	$	14,960
Total assets	$	599,706	$	126,797	$	98,160	$	824,663

Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”)

Management uses Adjusted EBITDA as a financial measure to assess segment performance. Adjusted EBITDA is defined as net income before interest expense, interest income, income tax expense, depreciation, amortization, share-based compensation, accretion of closure and post-closure liabilities, foreign currency gain/loss, non-cash property and equipment impairment charges, property insurance recoveries and other income/expense. Adjusted EBITDA is a complement to results provided in accordance with GAAP and we believe that such information provides additional useful information to analysts, stockholders and other users to understand the Company’s operating performance. Since Adjusted EBITDA is not a measurement determined in accordance with GAAP and is thus susceptible to varying calculations, Adjusted EBITDA as presented may not be comparable to other similarly titled measures of other companies. Items excluded from Adjusted EBITDA are significant components in understanding and assessing our financial performance. Adjusted EBITDA should not be considered in isolation or as an alternative to, or substitute for, net income, cash flows generated by operations, investing or financing activities, or other financial statement data presented in the consolidated financial statements as indicators of financial performance or liquidity. Adjusted EBITDA has limitations as an analytical tool and should not be considered in isolation or a substitute for analyzing our results as reported under GAAP. Some of the limitations are:

● Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;

● Adjusted EBITDA does not reflect our interest expense, or the requirements necessary to service interest or principal payments on our debt;

● Adjusted EBITDA does not reflect our income tax expenses or the cash requirements to pay our taxes;

● Adjusted EBITDA does not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments; and

● Although depreciation and amortization charges are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and Adjusted EBITDA does not reflect any cash requirements for such replacements.

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A reconciliation of Net income to Adjusted EBITDA is as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
$s in thousands	2019		2018		2019		2018
Net income	$	15,491	$	13,220	$	23,534	$	22,463
Income tax expense		6,395		4,258		9,436		7,778
Interest expense		3,588		2,907		7,618		5,716
Interest income		(202)		(39)		(409)		(63)
Foreign currency loss		384		139		523		153
Other income		(122)		(193)		(232)		(2,316)
Property and equipment impairment charges		—		—		25		—
Depreciation and amortization of plant and equipment		9,129		7,044		17,254		13,649
Amortization of intangible assets		2,863		2,296		5,674		4,598
Share-based compensation		1,245		1,011		2,467		2,079
Accretion and non-cash adjustment of closure & post-closure liabilities		1,133		1,081		2,258		2,155
Property insurance recoveries		(4,500)		—		(9,153)		—
Adjusted EBITDA	$	35,404	$	31,724	$	58,995	$	56,212

Adjusted EBITDA, by operating segment, is as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
$s in thousands	2019		2018		2019		2018
Adjusted EBITDA:
Environmental Services	$	47,056	$	39,860	$	82,316	$	74,532
Field & Industrial Services		5,022		4,562		7,576		6,907
Corporate		(16,674)		(12,698)		(30,897)		(25,227)
Total	$	35,404	$	31,724	$	58,995	$	56,212

Property and Equipment and Intangible Assets Outside of the United States

We provide services in the United States and Canada. Long-lived assets, comprised of property and equipment and intangible assets net of accumulated depreciation and amortization, by geographic location are as follows:

	June 30,		December 31,
$s in thousands	2019		2018
United States	$	481,301	$	480,322
Canada		59,185		57,787
Total long-lived assets	$	540,486	$	538,109

NOTE 18.   SUBSEQUENT EVENTS

Quarterly Dividend

On July 1, 2019, we declared a quarterly dividend of $0.18 per common share to stockholders of record on July 19, 2019. The dividend was paid using cash on hand on July 26, 2019 in an aggregate amount of $4.0 million.

Acquisition of W.I.S.E. Environmental Solutions Inc.

On August 1, 2019, we acquired 100% of the outstanding shares of W.I.S.E. Environmental Services Inc. (“US Ecology Sarnia”), an environmental services company based in Sarnia, Ontario, Canada for 23.5 million Canadian dollars. The purchase price is subject to post-closing adjustments based on agreed upon working capital requirements. Revenues, net income, earnings per share and total assets of US Ecology Sarnia are not material to our consolidated financial position or results of operations.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and Board of Directors of US Ecology, Inc.

Results of Review of Interim Financial Information

We have reviewed the accompanying consolidated balance sheet of US Ecology, Inc. and subsidiaries (the “Company”) as of June 30, 2019, the related consolidated statements of operations, comprehensive income, and stockholders’ equity for the three-month and six-month periods ended June 30, 2019 and 2018, and of cash flows for the six-month periods ended June 30, 2019 and 2018, and the related notes (collectively referred to as the “interim financial information”). Based on our reviews, we are not aware of any material modifications that should be made to the accompanying interim financial information for it to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheet of the Company as of December 31, 2018, and the related consolidated statements of operations, comprehensive income, stockholders’ equity, and cash flows for the year then ended (not presented herein); and in our report dated February 28, 2019, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet as of December 31, 2018, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

Basis for Review Results

This interim financial information is the responsibility of the Company's management. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our reviews in accordance with standards of the PCAOB. A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the PCAOB, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

/s/ Deloitte & Touche LLP

Boise, Idaho

August 5, 2019

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ITEM 2.       MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The information contained in this section should be read in conjunction with our unaudited consolidated financial statements and related notes thereto appearing elsewhere in this quarterly report on Form 10-Q. In this report words such as “we,” “us,” “our,” “US Ecology” and “the Company” refer to US Ecology, Inc. and its subsidiaries.

OVERVIEW

US Ecology, Inc. is a leading North American provider of environmental services to commercial and government entities. The Company addresses the complex waste management needs of its customers, offering treatment, disposal and recycling of hazardous, non-hazardous and radioactive waste, as well as a wide range of complementary field and industrial services. US Ecology’s comprehensive knowledge of the waste business, its collection of waste management facilities and focus on safety, environmental compliance, and customer service enables us to effectively meet the needs of our customers and to build long-lasting relationships.

We have fixed facilities and service centers operating in the United States, Canada and Mexico. Our fixed facilities include five Resource Conservation and Recovery Act of 1976, subtitle C, hazardous waste landfills and one low-level radioactive waste landfill located near Beatty, Nevada; Richland, Washington; Robstown, Texas; Grand View, Idaho; Detroit, Michigan and Blainville, Québec, Canada. These facilities generate revenue from fees charged to transport, recycle, treat and dispose of waste and to perform various field and industrial services for our customers.

Our operations are managed in two reportable segments reflecting our internal management reporting structure and nature of services offered as follows:

Environmental Services - This segment provides a broad range of hazardous material management services including transportation, recycling, treatment and disposal of hazardous, non-hazardous and radioactive waste at Company-owned landfill, wastewater, deep-well injection and other treatment facilities.

Field & Industrial Services - This segment provides packaging and collection of hazardous waste and total waste management solutions at customer sites and through our 10-day transfer facilities. Services include on-site management, waste characterization, transportation and disposal of non-hazardous and hazardous waste. This segment also provides specialty field services such as industrial cleaning and maintenance, remediation, lab packs, retail services, transportation, emergency response and other services to commercial and industrial facilities and to government entities.

In order to provide insight into the underlying drivers of our waste volumes and related treatment and disposal (“T&D”) revenues, we evaluate period-to-period changes in our T&D revenue for our Environmental Services segment based on the industry of the waste generator, based on North American Industry Classification System (“NAICS”) codes.

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The composition of Environmental Services segment T&D revenues by waste generator industry for the three and six months ended June 30, 2019 and 2018 were as follows:

	% of Treatment and Disposal Revenue (1) for the
	Three Months Ended June 30,
Generator Industry	2019	2018
Metal Manufacturing	18%	17%
Chemical Manufacturing	17%	14%
Broker / TSDF	13%	14%
General Manufacturing	11%	12%
Government	11%	6%
Refining	9%	11%
Transportation	3%	3%
Utilities	3%	3%
Waste Management & Remediation	2%	4%
Mining, Exploration and Production	2%	2%
Other (2)	11%	14%

	% of Treatment and Disposal Revenue (1) for the
	Six Months Ended June 30,
Generator Industry	2019	2018
Metal Manufacturing	17%	16%
Chemical Manufacturing	16%	14%
Broker / TSDF	14%	14%
General Manufacturing	12%	12%
Refining	10%	11%
Government	9%	6%
Utilities	3%	3%
Transportation	3%	3%
Waste Management & Remediation	2%	3%
Mining, Exploration and Production	2%	2%
Other (2)	12%	16%

(1) Excludes all transportation service revenue.

(2) Includes retail and wholesale trade, rate regulated, construction and other industries.

We also categorize our Environmental Services T&D revenue as either “Base Business” or “Event Business” based on the underlying nature of the revenue source.

Base Business consists of waste streams from ongoing industrial activities and tends to be recurring in nature. We define Event Business as non-recurring projects that are expected to equal or exceed 1,000 tons, with Base Business defined as all other business not meeting the definition of Event Business. The duration of Event Business projects can last from a several-week cleanup of a contaminated site to a multiple year cleanup project.

For the three months ended June 30, 2019, Base Business revenue increased 7% compared to the three months ended June 30, 2018. For the three months ended June 30, 2019, approximately 77% of our total T&D revenue was derived from our Base Business, down from 81% for the three months ended June 30, 2018. For the six months ended June 30, 2019, Base Business revenue increased 7% compared to the six months ended June 30, 2018. For the six months ended June 30, 2019, approximately 81% of our total T&D revenue was derived from our Base Business, down from 82% for the six months ended June 30, 2018. Our business is highly competitive and no assurance can be given that we will maintain these revenue levels or increase our market share.

A significant portion of our disposal revenue is attributable to discrete Event Business projects which vary widely in size, duration and unit pricing. For the three months ended June 30, 2019, approximately 23% of our total T&D revenue was derived from Event Business projects, up from 19% for the three months ended June 30, 2018. For the three months ended

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June 30, 2019, Event Business revenue increased 34% compared to the three months ended June 30, 2018. For the six months ended June 30, 2019, approximately 19% of our total T&D revenue was derived from Event Business projects, up from 18% for the six months ended June 30, 2018. For the six months ended June 30, 2019, Event Business revenue increased 18% compared to the six months ended June 30, 2018. The one-time nature of Event Business, diverse spectrum of waste types received and widely varying unit pricing necessarily creates variability in revenue and earnings. This variability may be influenced by general and industry-specific economic conditions, funding availability, changes in laws and regulations, government enforcement actions or court orders, public controversy, litigation, weather, commercial real estate, closed military bases and other project timing, government appropriation and funding cycles and other factors. The types and amounts of waste received from Base Business also vary from quarter to quarter.

This variability can also cause significant quarter-to-quarter and year-to-year differences in revenue, gross profit, gross margin, operating income and net income. While we pursue many projects months or years in advance of work performance, cleanup project opportunities routinely arise with little or no prior notice. These market dynamics are inherent to the waste disposal business and are factored into our projections and externally communicated business outlook statements. Our projections combine historical experience with identified sales pipeline opportunities, new or expanded service line projections and prevailing market conditions.

Depending on project-specific customer needs and competitive economics, transportation services may be offered at or near our cost to help secure new business. For waste transported by rail from the eastern United States and other locations distant from our Grand View, Idaho and Robstown, Texas facilities, transportation-related revenue can account for as much as 75% of total project revenue. While bundling transportation and disposal services reduces overall gross profit as a percentage of total revenue (“gross margin”), this value-added service has allowed us to win multiple projects that management believes we could not have otherwise competed for successfully. Our Company-owned fleet of gondola railcars, which is periodically supplemented with railcars obtained under operating leases, has reduced our transportation expenses by largely eliminating reliance on more costly short-term rentals. These Company-owned railcars also help us to win business during times of demand-driven railcar scarcity.

The increased waste volumes resulting from projects won through this bundled service strategy further drive operating leverage benefits inherent to the disposal business, increasing profitability. While waste treatment and other variable costs are project-specific, the incremental earnings contribution from large and small projects generally increases as overall disposal volumes increase. Based on past experience, management believes that maximizing operating income, net income and earnings per share is a higher priority than maintaining or increasing gross margin. We intend to continue aggressively bidding bundled transportation and disposal services based on this proven strategy.

We serve oil refineries, chemical production plants, steel mills, waste brokers/aggregators serving small manufacturers and other industrial customers that are generally affected by the prevailing economic conditions and credit environment. Adverse conditions may cause our customers as well as those they serve to curtail operations, resulting in lower waste production and/or delayed spending on off-site waste shipments, maintenance, waste cleanup projects and other work. Factors that can impact general economic conditions and the level of spending by customers include, but are not limited to, consumer and industrial spending, increases in fuel and energy costs, conditions in the real estate and mortgage markets, labor and healthcare costs, access to credit, consumer confidence and other global economic factors affecting spending behavior. Market forces may also induce customers to reduce or cease operations, declare bankruptcy, liquidate or relocate to other countries, any of which could adversely affect our business. To the extent business is either government funded or driven by government regulations or enforcement actions, we believe it is less susceptible to general economic conditions. Spending by government agencies may be reduced due to declining tax revenues resulting from a weak economy or changes in policy. Disbursement of funds appropriated by Congress may also be delayed for various reasons.

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RESULTS OF OPERATIONS

THREE MONTHS ENDED JUNE 30, 2019 COMPARED TO THREE MONTHS ENDED JUNE 30, 2018

Operating results and percentage of revenues were as follows:

	Three Months Ended June 30,								2019  vs. 2018
$s in thousands	2019		%		2018		%		$ Change		% Change
Revenue
Environmental Services	$	112,844	72	%	$	98,960	72	%	$	13,884	14	%
Field & Industrial Services		42,958	28	%		37,952	28	%		5,006	13	%
Total		155,802	100	%		136,912	100	%		18,890	14	%
Gross Profit
Environmental Services		43,081	38	%		35,899	36	%		7,182	20	%
Field & Industrial Services		6,502	15	%		5,549	15	%		953	17	%
Total		49,583	32	%		41,448	30	%		8,135	20	%
Selling, General & Administrative Expenses
Environmental Services		2,010	2	%		4,825	5	%		(2,815)	(58)	%
Field & Industrial Services		3,739	9	%		2,454	6	%		1,285	52	%
Corporate		18,300	n/m			13,877	n/m			4,423	32	%
Total		24,049	15	%		21,156	15	%		2,893	14	%
Adjusted EBITDA
Environmental Services		47,056	42	%		39,860	40	%		7,196	18	%
Field & Industrial Services		5,022	12	%		4,562	12	%		460	10	%
Corporate		(16,674)	n/m			(12,698)	n/m			(3,976)	31	%
Total	$	35,404	23	%	$	31,724	23	%	$	3,680	12	%

Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”)

Management uses Adjusted EBITDA as a financial measure to assess segment performance. Adjusted EBITDA is defined as net income before interest expense, interest income, income tax expense, depreciation, amortization, share-based compensation, accretion of closure and post-closure liabilities, foreign currency gain/loss, property insurance recoveries and other income/expense. The reconciliation of Net income to Adjusted EBITDA is as follows:

	Three Months Ended June 30,				2019 vs. 2018
$s in thousands	2019		2018		$ Change		% Change
Net income	$	15,491	$	13,220	$	2,271	17	%
Income tax expense		6,395		4,258		2,137	50	%
Interest expense		3,588		2,907		681	23	%
Interest income		(202)		(39)		(163)	418	%
Foreign currency loss		384		139		245	176	%
Other income		(122)		(193)		71	(37)	%
Depreciation and amortization of plant and equipment		9,129		7,044		2,085	30	%
Amortization of intangible assets		2,863		2,296		567	25	%
Share-based compensation		1,245		1,011		234	23	%
Accretion and non-cash adjustment of closure & post-closure liabilities		1,133		1,081		52	5	%
Property insurance recoveries		(4,500)		—		(4,500)	n/m
Adjusted EBITDA	$	35,404	$	31,724	$	3,680	12	%

Adjusted EBITDA is a complement to results provided in accordance with accounting principles generally accepted in the United States (“GAAP”) and we believe that such information provides additional useful information to analysts, stockholders and other users to understand the Company’s operating performance. Since Adjusted EBITDA is not a measurement determined in accordance with GAAP and is thus susceptible to varying calculations, Adjusted EBITDA as

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presented may not be comparable to other similarly titled measures of other companies. Items excluded from Adjusted EBITDA are significant components in understanding and assessing our financial performance. Adjusted EBITDA should not be considered in isolation or as an alternative to, or substitute for, net income, cash flows generated by operations, investing or financing activities, or other financial statement data presented in the consolidated financial statements as indicators of financial performance or liquidity.

Adjusted EBITDA has limitations as an analytical tool and should not be considered in isolation or a substitute for analyzing our results as reported under GAAP. Some of the limitations are:

● Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;

● Adjusted EBITDA does not reflect our interest expense, or the requirements necessary to service interest or principal payments on our debt;

● Adjusted EBITDA does not reflect our income tax expenses or the cash requirements to pay our taxes;

● Adjusted EBITDA does not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments; and

● Although depreciation and amortization charges are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and Adjusted EBITDA does not reflect any cash requirements for such replacements.

Revenue

Total revenue increased 14% to $155.8 million for the second quarter of 2019 compared with $136.9 million for the second quarter of 2018.

Environmental Services

Environmental Services segment revenue increased 14% to $112.8 million for the second quarter of 2019, compared to $99.0 million for the second quarter of 2018. T&D revenue increased 16% compared to the second quarter of 2018, comprised of a 7% increase in Base Business revenue and a 34% increase in project-based Event Business revenue. Transportation service revenue increased 9% compared to the second quarter of 2018, reflecting more Event Business projects utilizing the Company’s transportation and logistics services. Total tons of waste disposed of or processed across all of our facilities increased 38% for the second quarter of 2019 compared to the second quarter of 2018, partially reflecting incremental volumes disposed at our Winnie, Texas deep-well facility that was acquired in the fourth quarter of 2018 as well as a 17% increase in tons of waste disposed of or processed at our landfills for the second quarter of 2019 compared to the second quarter of 2018.

T&D revenue from recurring Base Business waste generators increased 7% for the second quarter of 2019 compared to the second quarter of 2018 and comprised 77% of total T&D revenue for the second quarter of 2019. During the second quarter of 2019, increases in Base Business T&D revenue from the general manufacturing, refining, “Other” and metal manufacturing industry groups were partially offset by a decrease in Base Business T&D revenue from the waste management & remediation and chemical manufacturing industry groups.

T&D revenue from Event Business waste generators increased 34% for the second quarter of 2019 compared to the second quarter of 2018 and comprised 23% of total T&D revenue for the second quarter of 2019. During the second quarter of 2019, increases in Event Business T&D revenue from the government, chemical manufacturing and metal manufacturing industry groups were partially offset by a decrease in Event Business T&D revenue from the “Other”, refining and waste management & remediation industry groups.

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The following table summarizes combined Base Business and Event Business T&D revenue growth, within the Environmental Services segment, by generator industry for the second quarter of 2019 as compared to the second quarter of 2018:

	Treatment and Disposal Revenue Growth
	Three Months Ended June 30, 2019 vs.
	Three Months Ended June 30, 2018
Government	95%
Chemical Manufacturing	33%
Transportation	29%
Metal Manufacturing	15%
General Manufacturing	6%
Broker / TSDF	3%
Utilities	1%
Refining	-3%
Other	-8%
Mining, Exploration & Production	-21%
Waste Management & Remediation	-49%

Field & Industrial Services

Field & Industrial Services segment revenue increased 13% to $43.0 million for the second quarter of 2019 compared with $38.0 million for the second quarter of 2018. The increase in Field & Industrial Services segment revenue is primarily attributable to higher Transportation and Logistics revenues and growth in our Emergency Response business line primarily as a result of our acquisition of ES&H of Dallas, LLC (“ES&H Dallas”) in the third quarter of 2018, partially offset by lower revenues from our Remediation and Total Waste Management business lines.

Gross Profit

Total gross profit increased 20% to $49.6 million for the second quarter of 2019, up from $41.4 million for the second quarter of 2018. Total gross margin was 32% for the second quarter of 2019 compared with 30% for the second quarter of 2018.

Environmental Services

Environmental Services segment gross profit increased 20% to $43.1 million for the second quarter of 2019, up from $35.9 million for the second quarter of 2018. Total segment gross margin for the second quarter of 2019 was 38% compared with 36% for the second quarter of 2018. Gross profit for the second quarter of 2019 includes $2.2 million in business interruption insurance recoveries related to hurricane losses at our Robstown, Texas facility in 2017 and the incident at our Grand View, Idaho facility in the fourth quarter of 2018. T&D gross margin was 45% for the second quarter of 2019 compared with 42% for the second quarter of 2018.

Field & Industrial Services

Field & Industrial Services segment gross profit increased 17% to $6.5 million for the second quarter of 2019, up from $5.5 million for the second quarter of 2018. Total segment gross margin was 15% for both the second quarter of 2019 and the second quarter of 2018.

Selling, General and Administrative Expenses (“SG&A”)

Total SG&A was $24.0 million, or 15% of total revenue, for the second quarter of 2019, up from $21.2 million, or 15% of total revenue, for the second quarter of 2018.

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Environmental Services

Environmental Services segment SG&A decreased 58% to $2.0 million, or 2% of segment revenue, for the second quarter of 2019 compared with $4.8 million, or 5% of segment revenue, for the second quarter of 2018, primarily reflecting property insurance recoveries of $4.5 million recognized in the second quarter of 2019 related to the incident at our Grand View, Idaho facility in the fourth quarter of 2018, partially offset by higher property tax expense and higher amortization expense.

Field & Industrial Services

Field & Industrial Services segment SG&A increased 52% to $3.7 million, or 9% of segment revenue, for the second quarter of 2019 compared with $2.5 million, or 6% of segment revenue, for the second quarter of 2018, primarily reflecting incremental costs associated with new facilities.

Corporate

Corporate SG&A was $18.3 million, or 12% of total revenue, for the second quarter of 2019 compared with $13.9 million, or 10% of total revenue, for the second quarter of 2018, primarily reflecting higher business development expenses, employee labor costs and information technology related expenses in the second quarter of 2019 compared with the second quarter of 2018.

Components of Adjusted EBITDA

Income tax expense

Our effective income tax rate for the second quarter of 2019 was 29.2%, compared with 24.4% for the second quarter of 2018. The increase in the effective tax rate was primarily due to non-deductible business development expenses and higher effective state tax rates, partially offset by federal research and development credits.

Interest expense

Interest expense was $3.6 million for the second quarter of 2019 compared with $2.9 million for the second quarter of 2018. The increase is the result of higher outstanding debt levels in the second quarter of 2019 due to the acquisition of Ecoserv Industrial Disposal, LLC (“Winnie”) in November of 2018, as well as higher interest rates on the variable portion of our outstanding debt.

Foreign currency gain (loss)

We recognized a $384,000 foreign currency loss for the second quarter of 2019 compared with a $139,000 foreign currency loss for the second quarter of 2018. Foreign currency gains and losses reflect changes in business activity conducted in a currency other than the United States dollar (“USD”), our functional currency. Additionally, we established intercompany loans between our Canadian subsidiaries, whose functional currency is the Canadian dollar (“CAD”), and our parent company, US Ecology, as part of a tax and treasury management strategy allowing for repayment of third-party bank debt. These intercompany loans are payable by our Canadian subsidiaries to US Ecology in CAD requiring us to revalue the outstanding loan balance through our statements of operations based on USD/CAD currency movements from period to period. At June 30, 2019, we had $18.6 million of intercompany loans subject to currency revaluation.

Other income

Other income was $122,000 for the second quarter of 2019 compared with other income of $193,000 million for the second quarter of 2018.

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Depreciation and amortization of plant and equipment

Depreciation and amortization expense was $9.1 million for the second quarter of 2019 compared with $7.0 million for the second quarter of 2018, primarily reflecting additional depreciation expense on assets associated with ES&H Dallas and Winnie that were acquired in the third and fourth quarter of 2018, respectively.

Amortization of intangible assets

Intangible assets amortization expense was $2.9 million for the second quarter of 2019 compared with $2.3 million for the second quarter of 2018, primarily reflecting additional amortization of intangible assets recorded as a result of the ES&H Dallas and Winnie acquisitions in the third and fourth quarter of 2018, respectively.

Share-based compensation

Share-based compensation expense was $1.2 million for the second quarter of 2019 compared with $1.0 million for the second quarter 2018 as a result of an increase in equity-based awards granted to employees.

Accretion and non-cash adjustment of closure and post-closure liabilities

Accretion and non-cash adjustment of closure and post-closure liabilities was $1.1 million for the second quarter of both 2019 and 2018.

Property insurance recoveries

The Company recognized property-related insurance recoveries of $4.5 million in the second quarter of 2019 related to the incident at our Grand View, Idaho facility in the fourth quarter of 2018.

SIX MONTHS ENDED JUNE 30, 2019 COMPARED TO SIX MONTHS ENDED JUNE 30, 2018

Operating results and percentage of revenues were as follows:

	Six Months Ended June 30,								2019  vs. 2018
$s in thousands	2019		%		2018		%		$ Change		% Change
Revenue
Environmental Services	$	205,177	72	%	$	185,431	72	%	$	19,746	11	%
Field & Industrial Services		81,662	28	%		71,540	28	%		10,122	14	%
Total		286,839	100	%		256,971	100	%		29,868	12	%
Gross Profit
Environmental Services		74,637	36	%		68,351	37	%		6,286	9	%
Field & Industrial Services		10,187	12	%		8,768	12	%		1,419	16	%
Total		84,824	30	%		77,119	30	%		7,705	10	%
Selling, General & Administrative Expenses
Environmental Services		3,415	2	%		11,201	6	%		(7,786)	(70)	%
Field & Industrial Services		7,123	9	%		4,711	7	%		2,412	51	%
Corporate		33,816	n/m			27,476	n/m			6,340	23	%
Total		44,354	15	%		43,388	17	%		966	2	%
Adjusted EBITDA
Environmental Services		82,316	40	%		74,532	40	%		7,784	10	%
Field & Industrial Services		7,576	9	%		6,907	10	%		669	10	%
Corporate		(30,897)	n/m			(25,227)	n/m			(5,670)	22	%
Total	$	58,995	21	%	$	56,212	22	%	$	2,783	5	%

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Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”)

Management uses Adjusted EBITDA as a financial measure to assess segment performance. Adjusted EBITDA is defined as net income before interest expense, interest income, income tax expense, depreciation, amortization, share-based compensation, accretion of closure and post-closure liabilities, foreign currency gain/loss, non-cash property and equipment impairment charges, property insurance recoveries and other income/expense. The reconciliation of Net income to Adjusted EBITDA is as follows:

	Six Months Ended June 30,				2019 vs. 2018
$s in thousands	2019		2018		$ Change		% Change
Net income	$	23,534	$	22,463	$	1,071	5	%
Income tax expense		9,436		7,778		1,658	21	%
Interest expense		7,618		5,716		1,902	33	%
Interest income		(409)		(63)		(346)	549	%
Foreign currency loss		523		153		370	242	%
Other income		(232)		(2,316)		2,084	(90)	%
Property and equipment impairment charges		25		—		25	n/m
Depreciation and amortization of plant and equipment		17,254		13,649		3,605	26	%
Amortization of intangible assets		5,674		4,598		1,076	23	%
Share-based compensation		2,467		2,079		388	19	%
Accretion and non-cash adjustment of closure & post-closure liabilities		2,258		2,155		103	5	%
Property insurance recoveries		(9,153)		—		(9,153)	n/m
Adjusted EBITDA	$	58,995	$	56,212	$	2,783	5	%

Adjusted EBITDA is a complement to results provided in accordance with accounting principles generally accepted in the United States (“GAAP”) and we believe that such information provides additional useful information to analysts, stockholders and other users to understand the Company’s operating performance. Since Adjusted EBITDA is not a measurement determined in accordance with GAAP and is thus susceptible to varying calculations, Adjusted EBITDA as presented may not be comparable to other similarly titled measures of other companies. Items excluded from Adjusted EBITDA are significant components in understanding and assessing our financial performance. Adjusted EBITDA should not be considered in isolation or as an alternative to, or substitute for, net income, cash flows generated by operations, investing or financing activities, or other financial statement data presented in the consolidated financial statements as indicators of financial performance or liquidity.

Adjusted EBITDA has limitations as an analytical tool and should not be considered in isolation or a substitute for analyzing our results as reported under GAAP. Some of the limitations are:

● Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;

● Adjusted EBITDA does not reflect our interest expense, or the requirements necessary to service interest or principal payments on our debt;

● Adjusted EBITDA does not reflect our income tax expenses or the cash requirements to pay our taxes;

● Adjusted EBITDA does not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments; and

● Although depreciation and amortization charges are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and Adjusted EBITDA does not reflect any cash requirements for such replacements.

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Revenue

Total revenue increased 12% to $286.8 million for the first six months of 2019 compared with $257.0 million for the first six months of 2018.

Environmental Services

Environmental Services segment revenue increased 11% to $205.2 million for the first six months of 2019, compared to $185.4 million for the first six months of 2018. T&D revenue increased 12% compared to the first six months of 2018, comprised of a 7% increase in Base Business revenue and an 18% increase in project-based Event Business revenue. Transportation service revenue increased 8% compared to the first six months of 2018, reflecting more Event Business projects utilizing the Company’s transportation and logistics services. Total tons of waste disposed of or processed across all of our facilities increased 33% for the first six months of 2019 compared to the first six months of 2018, partially reflecting incremental volumes disposed at our Winnie, Texas deep-well facility that was acquired in the fourth quarter of 2018 as well as a 8% increase in tons of waste disposed of or processed at our landfills for the first six months of 2019 compared to the first six months of 2018.

T&D revenue from recurring Base Business waste generators increased 7% for the first six months of 2019 compared to the first six months of 2018 and comprised 81% of total T&D revenue for the first six months of 2019. During the first six months of 2019, increases in Base Business T&D revenue from the metal manufacturing, broker/TSDF, general manufacturing and “Other” industry groups were partially offset by a decrease in Base Business T&D revenue from the chemical manufacturing and waste management & remediation industry groups.

T&D revenue from Event Business waste generators increased 18% for the first six months of 2019 compared to the first six months of 2018 and comprised 19% of total T&D revenue for the first six months of 2019. During the first six months of 2019, increases in Event Business T&D revenue from the chemical manufacturing, government and metal manufacturing industry groups were partially offset by a decrease in Event Business T&D revenue from the “Other”, refining and waste management & remediation industry groups.

The following table summarizes combined Base Business and Event Business T&D revenue growth, within the Environmental Services segment, by generator industry for the first six months of 2019 as compared to the first six months of 2018:

	Treatment and Disposal Revenue Growth
	Six Months Ended June 30, 2019 vs.
	Six Months Ended June 30, 2018
Government	66%
Transportation	43%
Chemical Manufacturing	29%
Metal Manufacturing	16%
Broker / TSDF	10%
General Manufacturing	6%
Utilities	0%
Refining	-5%
Mining, Exploration & Production	-6%
Other	-14%
Waste Management & Remediation	-50%

Field & Industrial Services

Field & Industrial Services segment revenue increased 14% to $81.7 million for the first six months of 2019 compared with $71.5 million for the first six months of 2018. The increase in Field & Industrial Services segment revenue is primarily attributable to higher Transportation and Logistics revenues, growth in our Emergency Response business line primarily as a result of our acquisition of ES&H of Dallas, LLC (“ES&H Dallas”) in the third quarter of 2018 and higher Industrial Services revenues, partially offset by lower revenues from our Remediation and Total Waste Management business lines.

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Gross Profit

Total gross profit increased 10% to $84.8 million for the first six months of 2019, up from $77.1 million for the first six months of 2018. Total gross margin was 30% for both the first six months of 2019 and the first six months of 2018.

Environmental Services

Environmental Services segment gross profit increased 9% to $74.6 million for the first six months of 2019, up from $68.4 million for the first six months of 2018. Total segment gross margin for the first six months of 2019 was 36% compared with 37% for the first six months of 2018. Gross profit for the first six months of 2019 includes $2.2 million in business interruption insurance recoveries in the second quarter of 2019 related to hurricane losses at our Robstown, Texas facility in 2017 and the incident at our Grand View, Idaho facility in the fourth quarter of 2018. T&D gross margin was 42% for the first six months of 2019 compared with 41% for the first six months of 2018.

Field & Industrial Services

Field & Industrial Services segment gross profit increased 16% to $10.2 million for the first six months of 2019, up from $8.8 million for the first six months of 2018. Total segment gross margin was 12% for both the first six months of 2019 and the first six months of 2018.

Selling, General and Administrative Expenses (“SG&A”)

Total SG&A was $44.4 million, or 15% of total revenue, for the first six months of 2019, up from $43.4 million, or 17% of total revenue, for the first six months of 2018.

Environmental Services

Environmental Services segment SG&A decreased 70% to $3.4 million, or 2% of segment revenue, for the first six months of 2019 compared with $11.2 million, or 6% of segment revenue, for the first six months of 2018, primarily reflecting property insurance recoveries of $9.2 million recognized in the first six months of 2019 related to the incident at our Grand View, Idaho facility in the fourth quarter of 2018, partially offset by higher amortization expense, higher property taxes, and higher insurance costs.

Field & Industrial Services

Field & Industrial Services segment SG&A increased 51% to $7.1 million, or 9% of segment revenue, for the first six months of 2019 compared with $4.7 million, or 7% of segment revenue, for the first six months of 2018, primarily reflecting incremental costs associated with new facilities.

Corporate

Corporate SG&A was $33.8 million, or 12% of total revenue, for the first six months of 2019 compared with $27.5 million, or 11% of total revenue, for the first six months of 2018, primarily reflecting higher business development expenses, employee labor costs and information technology related expenses in the first six months of 2019 compared with the first six months of 2018.

Components of Adjusted EBITDA

Income tax expense

Our effective income tax rate for the first six months of 2019 was 28.6%, compared with 25.7% for the first six months of 2018. The increase in the effective tax rate was primarily due to non-deductible business development expenses and higher effective state tax rates, partially offset by federal research and development credits.

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Interest expense

Interest expense was $7.6 million for the first six months of 2019 compared with $5.7 million for the first six months of 2018. The increase is the result of higher outstanding debt levels in the first six months of 2019 due to the acquisition of Ecoserv Industrial Disposal, LLC (“Winnie”) in November of 2018, as well as higher interest rates on the variable portion of our outstanding debt.

Foreign currency gain (loss)

We recognized a $523,000 foreign currency loss for the first six months of 2019 compared with a $153,000 foreign currency loss for the first six months of 2018. Foreign currency gains and losses reflect changes in business activity conducted in a currency other than the United States dollar (“USD”), our functional currency. Additionally, we established intercompany loans between our Canadian subsidiaries, whose functional currency is the Canadian dollar (“CAD”), and our parent company, US Ecology, as part of a tax and treasury management strategy allowing for repayment of third-party bank debt. These intercompany loans are payable by our Canadian subsidiaries to US Ecology in CAD requiring us to revalue the outstanding loan balance through our statements of operations based on USD/CAD currency movements from period to period. At June 30, 2019, we had $18.6 million of intercompany loans subject to currency revaluation.

Other income

Other income was $232,000 for the first six months of 2019 compared with other income of $2.3 million for the first six months of 2018. Other income for the first six months of 2018 includes a $2.0 million gain on the issuance of a property easement on a portion of unutilized Company-owned land at one of our operating facilities.

Depreciation and amortization of plant and equipment

Depreciation and amortization expense was $17.3 million for the first six months of 2019 compared with $13.6 million for the first six months of 2018, primarily reflecting additional depreciation expense on assets associated with ES&H Dallas and Winnie that were acquired in the third and fourth quarter of 2018, respectively.

Amortization of intangible assets

Intangible assets amortization expense was $5.7 million for the first six months of 2019 compared with $4.6 million for the first six months of 2018, primarily reflecting additional amortization of intangible assets recorded as a result of the ES&H Dallas and Winnie acquisitions in the third and fourth quarter of 2018, respectively.

Share-based compensation

Share-based compensation expense was $2.5 million for the first six months of 2019 compared with $2.1 million for the first six months 2018 as a result of an increase in equity-based awards granted to employees.

Accretion and non-cash adjustment of closure and post-closure liabilities

Accretion and non-cash adjustment of closure and post-closure liabilities was $2.3 million for the first six months of 2019 compared with $2.2 for the first six months of 2018.

Property insurance recoveries

The Company recognized property-related insurance recoveries of $9.2 million in the first six months of 2019 related to the incident at our Grand View, Idaho facility in the fourth quarter of 2018

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CRITICAL ACCOUNTING POLICIES

Financial statement preparation requires management to make estimates and judgments that affect reported assets, liabilities, revenue and expenses and disclosure of contingent assets and liabilities. The accompanying unaudited consolidated financial statements are prepared using the same critical accounting policies disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2018, other than the adoption of the Accounting Standards Codification Topic 842, Leases, described in Note 1 and Note 9 of the Notes to Consolidated Financial Statements in “Part I, Item 1. Financial Statements (Unaudited)” of this Quarterly Report on Form 10-Q.

RECENTLY ISSUED ACCOUNTING STANDARDS

For information about recently issued accounting standards, see Note 1 of the Notes to Consolidated Financial Statements in “Part I, Item 1. Financial Statements (Unaudited)” of this Quarterly Report on Form 10-Q.

LIQUIDITY AND CAPITAL RESOURCES

Our primary sources of liquidity are cash and cash equivalents, cash generated from operations and borrowings under the 2017 Credit Agreement entered into on April 18, 2017. At June 30, 2019, we had $17.7 million in cash and cash equivalents immediately available and $160.3 million of borrowing capacity available under the 2017 Credit Agreement. We assess our liquidity in terms of our ability to generate cash to fund our operating, investing and financing activities. Our primary ongoing cash requirements are funding operations, capital expenditures, paying interest on our long-term debt, and paying declared dividends pursuant to our dividend policy. We believe future operating cash flows will be sufficient to meet our future operating, investing and dividend cash needs for the foreseeable future. Furthermore, existing cash balances and availability of additional borrowings under the 2017 Credit Agreement provide additional sources of liquidity should they be required.

Operating Activities

For the six months ended June 30, 2019, net cash provided by operating activities was $38.9 million. This primarily reflects net income of $23.5 million, non-cash depreciation, amortization and accretion of $25.2 million, deferred incomes taxes of $3.7 million, share-based compensation of $2.5 million, and an increase in deferred revenue of $2.4 million, partially offset by a $9.2 million gain on insurance proceeds from damaged property and equipment, an increase in accounts receivable of $5.3 million, a decrease in accrued salaries and benefits of $2.0 million and an increase in other assets of $1.4 million. Impacts on net income are due to the factors discussed above under “Results of Operations.” Changes in deferred income taxes are primarily attributable to deferred tax gains resulting from involuntary conversions related to the incident at our Grand View, Idaho facility in the fourth quarter of 2018. The increase in deferred revenue is primarily attributable to cash payments that are received, or advance billings charged, prior to performance of services; and waste that has been received but not yet treated or disposed at the end of the period. We recognized property-related insurance recoveries in the first six months of 2019 related to the incident at our Grand View, Idaho facility in the fourth quarter of 2018. The increase in receivables is primarily attributable to the timing of customer payments. The decrease in accrued salaries and benefits is primarily attributable to cash payments during the first six months of 2019 for accrued 2018 incentive compensation.

Days sales outstanding were 84 days as of June 30, 2019, compared to 77 days as of December 31, 2018 and 75 days as of June 30, 2018.

For the six months ended June 30, 2018, net cash provided by operating activities was $48.0 million. This primarily reflects net income of $22.5 million, non-cash depreciation, amortization and accretion of $20.4 million, an increase in accounts payable and accrued liabilities of $10.3 million and share-based compensation of $2.1 million, partially offset by a decrease in income taxes payable of $2.9 million, an increase in income taxes receivable of $2.9 million, and a decrease in accrued salaries and benefits of $2.3 million. Impacts on net income are due to the factors discussed above under “Results of Operations.” The increase in accounts payable and accrued liabilities is primarily attributable to the timing of payments to vendors for products and services. The decrease in income taxes payable and the increase in income taxes receivable is

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primarily attributable to the timing of income tax payments. The decrease in accrued salaries and benefits is primarily attributable to cash payments during the first six months of 2018 for accrued 2017 incentive compensation.

Investing Activities

For the six months ended June 30, 2019, net cash used in investing activities was $14.7 million, primarily related to capital expenditures of $24.7 million, partially offset by property insurance proceeds of $9.5 million related to the incident at our Grand View, Idaho facility in the fourth quarter of 2018. Significant capital projects included construction of additional disposal capacity at our Blainville, Quebec, Canada and our Robstown, Texas facilities as well as equipment purchases and infrastructure upgrades at our corporate and operating facilities.

For the six months ended June 30, 2018, net cash used in investing activities was $14.9 million, primarily related to capital expenditures. Significant capital projects included continuing construction of additional disposal capacity and railway expansion at our Blainville, Quebec, Canada location and equipment purchases and infrastructure upgrades at our corporate and operating facilities.

Financing Activities

For the six months ended June 30, 2019, net cash used in financing activities was $39.3 million, consisting primarily of $30.0 million in payments on our revolving credit facility and dividend payments to our stockholders of $7.9 million.

For the six months ended June 30, 2018, net cash used in financing activities was $6.9 million, consisting primarily of dividend payments to our stockholders of $7.9 million, partially offset by $1.5 million in proceeds received from the exercise of stock options.

2017 Credit Agreement

The 2017 Credit Agreement provides for a $500.0 million, five-year revolving credit facility (the “Revolving Credit Facility”), including a $75.0 million sublimit for the issuance of standby letters of credit and a $25.0 million sublimit for the issuance of swingline loans used to fund short-term working capital requirements. The 2017 Credit Agreement also contains an accordion feature whereby the Company may request up to $200.0 million of additional funds through an increase to the Revolving Credit Facility, through incremental term loans, or some combination thereof. Proceeds from the Revolving Credit Facility are restricted solely for working capital and other general corporate purposes (including acquisitions and capital expenditures). Under the Revolving Credit Facility, revolving credit loans are available based on a base rate (as defined in the 2017 Credit Agreement) or LIBOR, at the Company’s option, plus an applicable margin which is determined according to a pricing grid under which the interest rate decreases or increases based on our ratio of funded debt to consolidated earnings before interest, taxes, depreciation and amortization (as defined in the 2017 Credit Agreement). The Company is pursuing an amendment to the 2017 Credit Agreement to, among other things, permit a $400.0 million term loan, which the Company intends to use in refinancing existing indebtedness of NRCG in connection with the Mergers and to pay the fees and expenses of the Company incurred in connection with the Mergers and the transactions in connection therewith.

At June 30, 2019, the effective interest rate on the Revolving Credit Facility, including the impact of our interest rate swap, was 3.61%. Interest only payments are due either quarterly or on the last day of any interest period, as applicable. In October 2014, the Company entered into an interest rate swap agreement, effectively fixing the interest rate on $160.0 million, or 48%, of the Revolving Credit Facility borrowings as of June 30, 2019.

The Company is required to pay a commitment fee ranging from 0.175% to 0.35% on the average daily unused portion of the Revolving Credit Facility, with such commitment fee to be reduced based upon the Company’s total net leverage ratio (as defined in the 2017 Credit Agreement). The maximum letter of credit capacity under the Revolving Credit Facility is $75.0 million and the 2017 Credit Agreement provides for a letter of credit fee equal to the applicable margin for LIBOR loans under the Revolving Credit Facility. At June 30, 2019, there were $334.0 million of borrowings outstanding on the Revolving Credit Facility. These borrowings are due on the revolving credit maturity date (as defined in the 2017 Credit Agreement) and presented as long-term debt in the consolidated balance sheets.

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The Company has entered into a sweep arrangement whereby day-to-day cash requirements in excess of available cash balances are advanced to the Company on an as-needed basis with repayments of these advances automatically made from subsequent deposits to our cash operating accounts (the “Sweep Arrangement”). Total advances outstanding under the Sweep Arrangement are subject to the $25.0 million swingline loan sublimit under the Revolving Credit Facility. The Company’s revolving credit loans outstanding under the Revolving Credit Facility are not subject to repayment through the Sweep Arrangement. As of June 30, 2019, there were no amounts outstanding subject to the Sweep Arrangement.

As of June 30, 2019, the availability under the Revolving Credit Facility was $160.3 million with $5.7 million of the Revolving Credit Facility issued in the form of standby letter of credit utilized as collateral for closure and post-closure financial assurance and other assurance obligations.

For more information about our debt, see Note 11 of the Notes to Consolidated Financial Statements in “Part I, Item 1. Financial Statements (Unaudited)” of this Quarterly Report on Form 10-Q.

CONTRACTUAL OBLIGATIONS AND GUARANTEES

There were no material changes in the amounts of our contractual obligations and guarantees during the six months ended June 30, 2019. For further information on our contractual obligations and guarantees, refer to our Annual Report on Form 10-K for the fiscal year ended December 31, 2018.

ITEM 3.       QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk

We do not maintain equities, commodities, derivatives, or any other similar instruments for trading purposes. We have minimal interest rate risk on investments or other assets due to our preservation of capital approach to investments. At June 30, 2019, $5.0 million of restricted cash was invested in fixed-income U.S. Treasury and U.S. government agency securities and money market accounts.

We are exposed to changes in interest rates as a result of our borrowings under the 2017 Credit Agreement. Under the 2017 Credit Agreement, Revolving Credit Facility borrowings incur interest at a base rate (as defined in the 2017 Credit Agreement) or LIBOR, at the Company’s option, plus an applicable margin which is determined according to a pricing grid under which the interest rate decreases or increases based on our ratio of funded debt to consolidated earnings before interest, taxes, depreciation and amortization (as defined in the 2017 Credit Agreement). On October 29, 2014, the Company entered into an interest rate swap agreement with the intention of hedging the Company’s interest rate exposure on a portion of the Company’s outstanding LIBOR-based variable rate debt. Under the terms of the swap, the Company pays interest at the fixed effective rate of 3.67% and receives interest at the variable one-month LIBOR rate on an initial notional amount of $250.0 million.

As of June 30, 2019, there were $334.0 million of revolving loans outstanding under the 2017 Credit Agreement. If interest rates were to rise and outstanding balances remain unchanged, we would be subject to higher interest payments on our outstanding debt. Subsequent to the effective date of the interest rate swap on December 31, 2014, we are subject to higher interest payments on only the unhedged borrowings under the 2017 Credit Agreement.

Based on the outstanding indebtedness of $334.0 million under the 2017 Credit Agreement at June 30, 2019 and the impact of our interest rate hedge, if market rates used to calculate interest expense were to average 1% higher in the next twelve months, our interest expense would increase by approximately $1.8 million for the corresponding period.

Foreign Currency Risk

We are subject to currency exposures and volatility because of currency fluctuations. The majority of our transactions are in USD; however, our Canadian subsidiaries conduct business in both Canada and the United States. In addition, contracts for services that our Canadian subsidiaries provide to U.S. customers are generally denominated in USD. During the six

45

months ended June 30, 2019, our Canadian subsidiaries transacted approximately 70% of their revenue in USD and at any time have cash on deposit in USD and outstanding USD trade receivables and payables related to these transactions. These USD cash, receivable and payable accounts are subject to non-cash foreign currency translation gains or losses. Exchange rate movements also affect the translation of Canadian generated profits and losses into USD.

We established intercompany loans between our Canadian subsidiaries and our parent company, US Ecology, as part of a tax and treasury management strategy allowing for repayment of third-party bank debt. These intercompany loans are payable using CAD and are subject to mark-to-market adjustments with movements in the CAD. At June 30, 2019, we had $18.6 million of intercompany loans outstanding between our Canadian subsidiaries and US Ecology. During the six months ended June 30, 2019, the CAD strengthened as compared to the USD resulting in a $778,000 non-cash foreign currency translation gain being recognized in the Company’s consolidated statements of operations related to the intercompany loans. Based on intercompany balances as of June 30, 2019, a $0.01 CAD increase or decrease in currency rate compared to the USD at June 30, 2019 would have generated a gain or loss of approximately $186,000 for the six months ended June 30, 2019.

We had a total pre-tax foreign currency loss of $523,000 for the six months ended June 30, 2019. We currently have no foreign exchange contracts, option contracts or other foreign currency hedging arrangements. Management evaluates the Company’s risk position on an ongoing basis to determine whether foreign exchange hedging strategies should be employed.

ITEM 4.       CONTROLS AND PROCEDURES

Management of the Company, including the Chief Executive Officer and the Chief Financial Officer of the Company, have evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of June 30, 2019. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures, including the accumulation and communication of disclosures to the Company’s Chief Executive Officer and Chief Financial Officer as appropriate to allow timely decisions regarding required disclosure, are effective to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified by the rules and forms of the Securities and Exchange Commission (“SEC”).

There were no changes in our internal control over financial reporting that occurred during the most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

SEC guidance permits management to omit an assessment of an acquired business’ internal control over financial reporting from management’s assessment of internal control over financial reporting for a period not to exceed one year from the date of acquisition. Accordingly, we have assessed neither ES&H Dallas’ nor Winnie’s internal control over financial reporting as of June 30, 2019.

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PART II - OTHER INFORMATION

Cautionary Statement for Purposes of “Safe Harbor Provisions” of the Private Securities Litigation Reform Act of 1995

This quarterly report on Form 10-Q contains forward-looking statements within the meaning of the federal securities laws. Statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements. Forward-looking statements include statements preceded by, followed by or that include the words “may,” “could,” “would,” “should,” “believe,” “expect,” “anticipate,” “plan,” “estimate,” “target,” “project,” “intend” and similar expressions. These statements include, among others, statements regarding our financial and operating results, strategic objectives and means to achieve those objectives, the amount and timing of capital expenditures, repurchases of its stock under approved stock repurchase plans, the amount and timing of interest expense, the likelihood of our success in expanding our business, financing plans, budgets, working capital needs and sources of liquidity.

Forward-looking statements are only predictions and are not guarantees of performance. These statements are based on management’s beliefs and assumptions, which in turn are based on currently available information. Important assumptions include, among others, those regarding demand for Company services, expansion of service offerings geographically or through new or expanded service lines, the timing and cost of planned capital expenditures, competitive conditions and general economic conditions. These assumptions could prove inaccurate. Forward-looking statements also involve known and unknown risks and uncertainties, which could cause actual results to differ materially from those contained in any forward-looking statement. Many of these factors are beyond our ability to control or predict. Such factors include an accident at one of our facilities, incidents resulting from the handling of dangerous substances, the loss or failure to renew significant contracts, competition in our markets, adverse economic conditions, our compliance with applicable laws and regulations, the realization of anticipated benefits from acquired operations, our ability to perform under required contracts, limitations on our available cash flow as a result of our indebtedness, liabilities arising from our participation in multi-employer pension plans, cyber security threats, unanticipated changes in tax rules and regulations, loss of key personnel, a deterioration in our labor relations or labor disputes, our ability to pay dividends or repurchase stock, anti-takeover regulations, stock market volatility, our access to insurance, surety bonds and other financial assurances, our litigation risk not covered by insurance, the replacement of non-recurring event projects, our ability to permit and contract for timely construction of new or expanded disposal space, renewals of our operating permits or lease agreements with regulatory bodies, our ability or the timing of reconstructing and receiving regulatory approvals for the reopening of the Grand View, Idaho treatment facility, the timing or amount of insurance recoveries associated with the reconstruction and business interruption losses for the Grand View, Idaho treatment facility, our access to cost-effective transportation services, lawsuits, our implementation of new technologies, fluctuations in foreign currency markets, foreign affairs and other factors described under “Risk Factors” and “Cautionary Statements Regarding Forward-Looking Statements” in the Form S-4 (Registration No. 333-232930), dated July 31, 2019 (the “Form S-4”), filed by US Ecology Parent, Inc., a wholly-owned subsidiary of the Company, with the SEC.

Except as required by applicable law, including the securities laws of the United States and the rules and regulations of the SEC, we are under no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. You should not place undue reliance on our forward-looking statements. Although we believe that the expectations reflected in forward-looking statements are reasonable, we cannot guarantee future results or performance. Before you invest in our common stock, you should be aware that the occurrence of the events described in the “Risk Factors” section in our Form 10-K for the fiscal year ended December 31, 2018, the Form S-4 and in other reports we file with the SEC could harm our business, prospects, operating results, and financial condition.

Investors should also be aware that while we do, from time to time, communicate with securities analysts, it is against our policy to disclose to them any material non-public information or other confidential commercial information. Accordingly, stockholders should not assume that we agree with any statement or report issued by any analyst irrespective of the content of the statement or report. Furthermore, we have a policy against issuing or confirming financial forecasts or projections issued by others. Thus, to the extent that reports issued by securities analysts contain any projections, forecasts or opinions, such reports are not the responsibility of US Ecology, Inc.

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ITEM 1.       LEGAL PROCEEDINGS

On November 17, 2018, an explosion occurred at our Grand View, Idaho facility, resulting in one employee fatality and injuries to other employees. The incident severely damaged the facility’s primary waste-treatment building as well as surrounding waste handling, waste storage, maintenance and administrative support structures, resulting in the closure of the entire facility that remained in effect through January 2019. We resumed landfill operations at our Grand View, Idaho facility in first quarter of 2019 and resumed operations of our secondary waste-treatment facility in the second quarter of 2019. Reconstruction of the primary waste-treatment building is currently underway. In addition to conducting our own investigation into the incident, we are fully cooperating with government agencies, including IDEQ and the USEPA to support their comprehensive and independent investigations of the incident. We cannot presently estimate the potential liability related to the incident and, therefore, no amounts related to such claims have been recorded in our financial statements as of June 30, 2019. We have not been named as a defendant in any civil action relating to the incident. As a result of the OSHA’s inspection following the incident, OSHA issued a Citation and Notification of Penalty on May 6, 2019. We are currently contesting the Citation and Notification of Penalty before the Occupational Safety and Health Review Commission and the contested penalty is not material. We maintain workers’ compensation insurance, business interruption insurance and liability insurance for personal injury, property and casualty damage. We believe that any potential third-party claims associated with the explosion, in excess of our deductibles, are expected to be resolved primarily through our insurance policies. Although we carry business interruption insurance, a disruption of our business caused by a casualty event, including the full and partial closure of our Grand View, Idaho facility, may result in the loss of business, profits or customers during the time of such closure. Accordingly, our insurance policies may not fully compensate us for these losses.

Other than described above, we are not currently a party to any material pending legal proceedings and are not aware of any other claims that could, individually or in the aggregate, have a materially adverse effect on our financial position, results of operations or cash flows.

ITEM 1A.    RISK FACTORS

The Company is subject to various risks and uncertainties that could have a material impact on our business, financial condition, results of operations and cash flows. The discussion of these risk factors is included in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018 and there have been no material changes from the risk factors reported on the Form 10-K, as well as in the section entitled “Risk Factors” in the Form S-4, which could materially affect our business, financial condition or future results.

ITEM 2.       UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

On June 1, 2016, the Company’s Board of Directors authorized the repurchase of $25.0 million of the Company’s outstanding common stock. Repurchases may be made from time to time in open market or through privately negotiated transactions. The timing of any repurchases will be based upon prevailing market conditions and other factors. The Company did not repurchase any shares of common stock under the repurchase program during the six months ended June 30, 2019. On May 29, 2018 the repurchase program was extended and will remain in effect until June 6, 2020, unless further extended by our Board of Directors.

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The following table summarizes the purchases of shares of our common stock during the six months ended June 30, 2019:

				Total Number of	Approximate Dollar
				Shares Purchased as	Value of Shares that
				Part of Publicly	May Yet be Purchased
	Total Number of	Average Price		Announced Plan or	Under the Plans or
Period	Shares Purchased	Paid per Share		Program	Programs
January 1 to 31, 2019 (1)	14,462	$	63.34	—	$	25,000,000
February 1 to 28, 2019	—		—	—		25,000,000
March 1 to 31, 2019	—		—	—		25,000,000
April 1 to 30, 2019	—		—	—		25,000,000
May 1 to 31, 2019	—		—	—		25,000,000
June 1 to 30, 2019	—		—	—		25,000,000
Total	14,462	$	63.34	—	$	25,000,000

(1) Represents shares surrendered or forfeited in connection with certain employees’ tax withholding obligations related to the vesting of shares of restricted stock and performance stock units.

ITEM 3.       DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4.       MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5.       OTHER INFORMATION

None.

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ITEM 6.       EXHIBITS

2.1	Agreement and Plan of Merger, dated as of June 23, 2019, by and among US Ecology, Inc., NRC Group Holdings Corp., US Ecology Parent, Inc., Rooster Merger Sub, Inc. and ECOL Merger Sub, Inc.
10.1	Support Agreement, dated June 23, 2019, by and among US Ecology, Inc., US Ecology Parent, Inc., Rooster Merger Sub, Inc., JFL-NRC-SES Partners, LLC, JFL-NRCG Holdings III, LLC and JFL-NRCG Holdings IV, LLC
10.2	Investor Agreement, dated June 23, 2019, by and among US Ecology, Inc., US Ecology Parent, Inc., JFL-NRC-SES Partners, LLC, JFL-NRCG Holdings III, LLC, JFL-NRCG Holdings IV, LLC and solely with respect to Section 4 thereof, NRC Group Holdings Corp.
10.3	Registration Rights Agreement, dated June 23, 2019, by and among US Ecology, Inc., US Ecology Parent, Inc., JFL-NRC-SES Partners, LLC, JFL-NRCG Holdings III, LLC and JFL-NRCG Holdings IV, LLC
15	Letter re: Unaudited Interim Financial Statements
31.1	Certification of CEO Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of CFO Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101	The following materials from the quarterly report on Form 10-Q of US Ecology, Inc. for the quarter ended June 30, 2019 formatted in inline Extensible Business Reporting Language (XBRL) include: (i) Unaudited Consolidated Balance Sheets, (ii) Unaudited Consolidated Statements of Operations, (iii) Unaudited Consolidated Statements of Comprehensive Income, (iv) Unaudited Consolidated Statements of Cash Flows, and (v) Notes to the Unaudited Consolidated Financial Statements

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	US Ecology, Inc.
	(Registrant)
Date: August 5, 2019	/s/ Eric L. Gerratt
	Eric L. Gerratt
	Executive Vice President, Chief Financial Officer and Treasurer

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EX-15

EXHIBIT 15

August 5, 2019

US Ecology, Inc.

101 S. Capitol Blvd. Suite #1000

Boise, Idaho 83702

We have reviewed, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the unaudited interim financial information of US Ecology, Inc. and subsidiaries for the three-month and nine-month periods ended June 30, 2019 and 2018, as indicated in our report dated August 5, 2019; because we did not perform an audit, we expressed no opinion on that information.

We are aware that our report referred to above, which is included in your Quarterly Report on Form 10-Q for the quarter ended June 30, 2019, is incorporated by reference in Registration Statement Nos. 333-157529, 333-68868, 333-93105, 333-140419, 333-69863 and 333-207811 on Form S-8, Registration Statement No. 333-211807 on Form S-3, and Registration Statement No. 333-187003 on Form S-4.

We also are aware that the aforementioned report, pursuant to Rule 436(c) under the Securities Act of 1933, is not considered a part of the Registration Statement prepared or certified by an accountant or a report prepared or certified by an accountant within the meaning of Sections 7 and 11 of that Act.

/s/ Deloitte & Touche LLP

Boise, Idaho

EX-31.1

EXHIBIT 31.1

US ECOLOGY, INC.

CERTIFICATIONS PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, Jeffrey R. Feeler, certify that:

1.    I have reviewed this quarterly report on Form 10-Q of US Ecology, Inc.;

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)    Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)    Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 5, 2019	/s/ Jeffrey R. Feeler
	Jeffrey R. Feeler
	President and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

US ECOLOGY, INC.

CERTIFICATIONS PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, Eric L. Gerratt, certify that:

1.    I have reviewed this quarterly report on Form 10-Q of US Ecology, Inc.;

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)    Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)    Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 5, 2019	/s/ Eric L. Gerratt
	Eric L. Gerratt
	Executive Vice President, Chief Financial Officer and Treasurer

EX-32

EXHIBIT 32

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of US Ecology, Inc., (the “Company”) for the quarterly period ended June 30, 2019, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), we, Jeffrey R. Feeler and Eric L. Gerratt, Chief Executive Officer and Chief Financial Officer, respectively, of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to our knowledge:

(1)    The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)    The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods expressed in the Report.

Date: August 5, 2019	/s/ Jeffrey R. Feeler
	Jeffrey R. Feeler
	President and Chief Executive Officer
	/s/ Eric L. Gerratt
	Eric L. Gerratt
	Executive Vice President, Chief Financial Officer and Treasurer

XML

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2019	Jul. 30, 2019
Document and Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Jun. 30, 2019
Entity File Number	000-11688
Entity Registrant Name	US ECOLOGY, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	95-3889638
Entity Address, Address Line One	101 S. Capitol Blvd., Suite 1000
Entity Address, City or Town	Boise
Entity Address, State or Province	ID
Entity Address, Postal Zip Code	83702
City Area Code	208
Local Phone Number	331-8400
Title of 12(b) Security	Common Stock
Trading Symbol	ECOL
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		22,089,345
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q2
Entity Central Index Key	0000742126
Amendment Flag	false

XML

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Current Assets:
Cash and cash equivalents	$ 17,690	$ 31,969
Receivables, net	150,037	144,690
Prepaid expenses and other current assets	11,938	10,938
Income taxes receivable	6,661	7,071
Total current assets	186,326	194,668
Property and equipment, net	265,620	258,443
Operating lease assets	17,575
Restricted cash and investments	5,021	4,941
Intangible assets, net	274,866	279,666
Goodwill	210,466	207,177
Other assets	1,542	3,003
Total assets	961,416	947,898
Current Liabilities:
Accounts payable	21,733	17,754
Deferred revenue	12,985	10,451
Accrued liabilities	32,895	35,524
Accrued salaries and benefits	14,790	16,732
Income taxes payable		505
Current portion of closure and post-closure obligations	2,231	2,266
Current portion of operating lease liabilities	4,932
Total current liabilities	89,566	83,232
Long-term debt	334,000	364,000
Long-term closure and post-closure obligations	77,688	76,097
Long-term operating lease liabilities	12,553
Other long-term liabilities	4,132	2,146
Deferred income taxes, net	66,718	63,206
Total liabilities	584,657	588,681
Commitments and contingencies
Stockholders' Equity:
Common stock $0.01 par value, 50,000 authorized; 22,089 and 22,040 shares issued and outstanding, respectively	221	220
Additional paid-in capital	184,747	183,834
Retained earnings	204,916	189,324
Treasury stock, at cost, 14 and 8 shares, respectively	(835)	(370)
Accumulated other comprehensive loss	(12,290)	(13,791)
Total stockholders' equity	376,759	359,217
Total liabilities and stockholders' equity	$ 961,416	$ 947,898

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CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands	Jun. 30, 2019	Dec. 31, 2018
CONSOLIDATED BALANCE SHEETS
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	50,000	50,000
Common stock, shares issued	22,089	22,040
Common stock, shares outstanding	22,089	22,040
Treasury stock, shares	14	8

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CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
CONSOLIDATED STATEMENTS OF OPERATIONS
Revenue	$ 155,802	$ 136,912	$ 286,839	$ 256,971
Direct operating costs	106,219	95,464	202,015	179,852
Gross profit	49,583	41,448	84,824	77,119
Selling, general and administrative expenses	24,049	21,156	44,354	43,388
Operating income	25,534	20,292	40,470	33,731
Other income (expense):
Interest income	202	39	409	63
Interest expense	(3,588)	(2,907)	(7,618)	(5,716)
Foreign currency loss	(384)	(139)	(523)	(153)
Other	122	193	232	2,316
Total other expense	(3,648)	(2,814)	(7,500)	(3,490)
Income before income taxes	21,886	17,478	32,970	30,241
Income tax expense	6,395	4,258	9,436	7,778
Net income	$ 15,491	$ 13,220	$ 23,534	$ 22,463
Earnings per share:
Basic (in dollars per share)	$ 0.70	$ 0.60	$ 1.07	$ 1.03
Diluted (in dollars per share)	$ 0.70	$ 0.60	$ 1.06	$ 1.02
Shares used in earnings per share calculation:
Basic (in shares)	22,006	21,867	21,997	21,835
Diluted (in shares)	22,208	22,024	22,203	21,991

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Net income	$ 15,491	$ 13,220	$ 23,534	$ 22,463
Other comprehensive income (loss):
Foreign currency translation gain (loss)	1,680	(1,597)	3,369	(3,468)
Net changes in interest rate hedge, net of taxes of $(313), $167, $(497) and $592, respectively	(1,177)	628	(1,868)	2,223
Comprehensive income, net of tax	$ 15,994	$ 12,251	$ 25,035	$ 21,218

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Other comprehensive income (loss):
Net changes in interest rate hedge, tax	$ (313)	$ 167	$ (497)	$ 592

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CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018
Cash flows from operating activities:
Net income	$ 23,534	$ 22,463
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization of property and equipment	17,254	13,649
Amortization of intangible assets	5,674	4,598
Accretion of closure and post-closure obligations	2,258	2,155
Property and equipment impairment charges	25
Unrealized foreign currency loss (gain)	(502)	1,222
Deferred income taxes	3,690	27
Share-based compensation expense	2,467	2,079
Unrecognized tax benefits	131
Net loss (gain) on disposition of assets	(142)	11
Gain on insurance proceeds from damaged property and equipment	(9,153)
Amortization of debt issuance costs	409	405
Changes in assets and liabilities:
Receivables	(5,346)	(2,087)
Income taxes receivable	452	(2,851)
Other assets	(1,384)	88
Accounts payable and accrued liabilities	404	10,286
Deferred revenue	2,418	1,770
Accrued salaries and benefits	(2,025)	(2,317)
Income taxes payable	(515)	(2,905)
Closure and post-closure obligations	(775)	(583)
Net cash provided by operating activities	38,874	48,010
Cash flows from investing activities:
Purchases of property and equipment	(24,657)	(14,960)
Insurance proceeds from damaged property and equipment	9,500
Proceeds from sale of property and equipment	512	141
Purchases of restricted investments	(400)	(498)
Proceeds from sale of restricted investments	354	431
Net cash used in investing activities	(14,691)	(14,886)
Cash flows from financing activities:
Payments on long-term debt	(30,000)
Payments on short-term borrowings	(14,384)
Proceeds from short-term borrowings	14,384
Dividends paid	(7,942)	(7,884)
Payment of equipment financing obligations	(408)	(217)
Proceeds from exercise of stock options		1,471
Other	(914)	(312)
Net cash used in financing activities	(39,264)	(6,942)
Effect of foreign exchange rate changes on cash	836	(902)
Increase (decrease) in Cash and cash equivalents and restricted cash	(14,245)	25,280
Cash and cash equivalents and restricted cash at beginning of period	32,753	28,799
Cash and cash equivalents and restricted cash at end of period	18,508	54,079
Supplemental Disclosures:
Income taxes paid, net of receipts	5,694	13,625
Interest paid	6,850	5,288
Non-cash investing and financing activities:
Capital expenditures in accounts payable	834	493
Restricted stock issued from treasury shares	$ 451	$ 11

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS - (Restricted cash and investments) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018	Jun. 30, 2018	Dec. 31, 2017
Reconciliation of Cash and cash equivalents and restricted cash
Cash and cash equivalents	$ 17,690	$ 31,969	$ 53,303	$ 27,042
Restricted cash	818	784	776	1,757
Cash and cash equivalents and restricted cash	$ 18,508	$ 32,753	$ 54,079	$ 28,799

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CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Common Stock	Additional Paid-In Capital	Retained Earnings	Treasury Stock	Accumulated Other Comprehensive Income (Loss)	Total
Beginning balances at Dec. 31, 2017	$ 218	$ 177,498	$ 155,533	$ (68)	$ (9,104)	$ 324,077
Increase (Decrease) in Stockholders' Equity
Net income			22,463			22,463
Other comprehensive income (loss)					(1,245)
Share-based compensation		2,079
Stock option exercised and issuance of common stock and restricted common stock	2	1,121
Dividend paid			(7,884)
Repurchase of common stock				(313)
Issuance of restricted common stock from treasury shares		(11)		11
Ending balances at Jun. 30, 2018	220	180,687	170,112	(370)	(10,349)	340,300
Beginning balances at Mar. 31, 2018	219	178,840	160,838	(370)	(9,380)	330,147
Increase (Decrease) in Stockholders' Equity
Net income			13,220			13,220
Other comprehensive income (loss)					(969)
Share-based compensation		1,011
Stock option exercised and issuance of common stock and restricted common stock	1	836
Dividend paid			(3,946)
Ending balances at Jun. 30, 2018	220	180,687	170,112	(370)	(10,349)	340,300
Beginning balances at Dec. 31, 2018	220	183,834	189,324	(370)	(13,791)	$ 359,217
Balance (in shares) at Dec. 31, 2018						22,040,000
Increase (Decrease) in Stockholders' Equity
Net income			23,534			$ 23,534
Other comprehensive income (loss)					1,501
Share-based compensation		2,467
Stock option exercised and issuance of common stock and restricted common stock	1	(1,103)
Dividend paid			(7,942)
Repurchase of common stock				(916)
Issuance of restricted common stock from treasury shares		(451)		451
Issuance of restricted stock from treasury stock (in shares)						7,800
Ending balances at Jun. 30, 2019	221	184,747	204,916	(835)	(12,290)	$ 376,759
Balance (in shares) at Jun. 30, 2019						22,089,000
Beginning balances at Mar. 31, 2019	221	183,953	193,397	(1,286)	(12,793)	$ 363,492
Increase (Decrease) in Stockholders' Equity
Net income			15,491			15,491
Other comprehensive income (loss)					503
Share-based compensation		1,245
Dividend paid			(3,972)
Issuance of restricted common stock from treasury shares		(451)		451
Ending balances at Jun. 30, 2019	$ 221	$ 184,747	$ 204,916	$ (835)	$ (12,290)	$ 376,759
Balance (in shares) at Jun. 30, 2019						22,089,000

XML

GENERAL

6 Months Ended

Jun. 30, 2019

GENERAL

GENERAL

NOTE 1.     GENERAL

Basis of Presentation

The accompanying unaudited consolidated financial statements include the results of operations, financial position and cash flows of US Ecology, Inc. and its wholly-owned subsidiaries. All inter-company balances have been eliminated. Throughout these financial statements words such as “we,” “us,” “our,” “US Ecology” and “the Company” refer to US Ecology, Inc. and its subsidiaries.

In the opinion of management, the accompanying unaudited consolidated financial statements include all adjustments (consisting only of normal recurring adjustments) necessary to present fairly, in all material respects, the results of the Company for the periods presented. These consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been omitted pursuant to the rules and regulations of the SEC. These consolidated financial statements should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018. The results of operations for the three and six months ended June 30, 2019 are not necessarily indicative of the results to be expected for the entire year ending December 31, 2019.

The Company’s consolidated balance sheet as of December 31, 2018 has been derived from the Company’s audited consolidated balance sheet as of that date.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ materially from the estimates and assumptions that we use in the preparation of our consolidated financial statements. As it relates to estimates and assumptions in amortization rates and environmental obligations, significant engineering, operations and accounting judgments are required. We review these estimates and assumptions no less than annually. In many circumstances, the ultimate outcome of these estimates and assumptions will not be known for decades into the future. Actual results could differ materially from these estimates and assumptions due to changes in applicable regulations, changes in future operational plans and inherent imprecision associated with estimating environmental impacts far into the future.

Recently Issued Accounting Pronouncements

In August 2018, the SEC adopted the final rule under SEC Release No. 33-10532, “Disclosure Update and Simplification,” adopting amendments to certain disclosure rules that were redundant, duplicative, overlapping, outdated, or superseded, in light of other SEC disclosure requirements, GAAP or changes in the information environment. In addition, the amendments expanded the disclosure requirements relating to the analysis of equity for interim financial statements. Under the amendments, an analysis of the changes in each caption of shareholders’ equity and noncontrolling interests presented in the balance sheet must be provided in a note or separate statement. The analysis must present a reconciliation of the beginning balance to the ending balance of each period for which a statement of earnings is required to be filed. The final rule was effective on November 5, 2018. The Company adopted the final rule effective for the first quarter of 2019. The adoption of the final rule did not have an impact on the Company’s consolidated financial position or results of operations.

In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (Topic 815). This ASU amends the guidance in ASC 815 to better align an entity’s risk management activities and financial reporting for hedging relationships

through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The guidance is effective for annual and interim reporting periods beginning after December 15, 2018, with early adoption permitted. The Company adopted ASU 2017-12 on January 1, 2019 and the standard did not have a material impact on its consolidated financial statements.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The ASU significantly changes the accounting model used by lessees to account for leases, requiring that all material leases be presented on the balance sheet. Lessees will recognize substantially all leases on the balance sheet as a right-of-use asset and a corresponding lease liability. The Company adopted ASU 2016-02 on January 1, 2019 utilizing the modified retrospective transition method and elected not to recast comparative periods. We elected the package of practical expedients, which allows the Company not to reassess (1) whether any expired or existing contracts as of the adoption date are or contain a lease, (2) lease classification for any expired or existing leases as of the adoption date and (3) initial direct costs for any existing leases as of the adoption date.  We also elected the practical expedient related to land easements, allowing us to carry forward our accounting treatment for land easements on existing agreements. The Company did not elect to apply the hindsight practical expedient when determining lease term and assessing impairment of right-of-use assets.

Adoption of ASU 2016-02 resulted in the recognition of right-of-use assets and lease liabilities for operating leases of $18.1 million on its consolidated balance sheet as of March 31, 2019, with no material impact on its consolidated statement of stockholders’ equity or consolidated statements of operations. See Note 9 for additional information and disclosure on our leases.

NRCG Merger

On June 23, 2019, US Ecology, Inc. entered into an Agreement and Plan of Merger (the “Merger Agreement”) with NRC Group Holdings Corp., a Delaware corporation (“NRCG”), US Ecology Parent, Inc., a Delaware corporation and wholly-owned subsidiary of the Company (“Holdco”), Rooster Merger Sub, Inc., a Delaware corporation and a wholly-owned subsidiary of Holdco (“Rooster Merger Sub”), and ECOL Merger Sub, Inc., a Delaware corporation and a wholly-owned subsidiary of Holdco (“ECOL Merger Sub”).

The Merger Agreement provides that, subject to the conditions set forth in the Merger Agreement, ECOL Merger Sub will merge with and into the Company, with the Company continuing as the surviving company and as a wholly-owned subsidiary of Holdco (the “Parent Merger”). Substantially concurrently therewith, NRCG Merger Sub will merge with and into NRCG, with NRCG continuing as the surviving company and as a wholly-owned subsidiary of Holdco (the “Rooster Merger,” and, together with the Parent Merger, the “Mergers”). The parties to the Merger Agreement intend that (1) each of the Mergers will qualify as a “reorganization” within the meaning of Section 368(a) of the Internal Revenue Code of 1986 (the “Code”), (2) the Mergers together will be treated as an “exchange” described in Section 351 of the Code, and (3) the Merger Agreement will constitute a “plan of reorganization” for purposes of Sections 354 and 361 of the Code.

In the Parent Merger, each share of common stock, par value $0.01 per share, of the Company (“Company Common Stock”) issued and outstanding immediately prior to the applicable Effective Time (other than cancelled shares) will be converted into the right to receive one share of common stock, par value $0.01 per share, of Holdco (“Holdco Common Stock”). Outstanding equity awards of the Company will be rolled into equity awards at Holdco on a one-for-one basis. Each share of Company Common Stock that is held by the Company as treasury stock or that is owned by the Company, ECOL Merger Sub, or any other subsidiary of the Company, immediately prior to the effective time of the Mergers (the “Effective Time”) will cease to be outstanding and will be cancelled and retired and will cease to exist, and no consideration will be delivered in exchange therefor.

In the Rooster Merger, each share of common stock, par value $0.0001 per share, of NRCG (“NRCG Common Stock”) issued and outstanding immediately prior to the applicable Effective Time (other than cancelled shares) will be converted into the right to receive, and become exchangeable for: (1) 0.196 shares (the “NRCG Exchange Ratio”) of Holdco Common Stock; (2) cash in lieu of fractional shares of Holdco Common Stock payable pursuant to the Merger Agreement; and (3) any dividends or other distributions to which the holder thereof becomes entitled to upon the surrender of such shares of NRCG Common Stock in accordance with the Merger Agreement. Outstanding shares of NRCG equity awards will be converted into equity awards of Holdco pursuant to the mechanics set forth in the Merger Agreement. In the Rooster

Merger, each share of NRCG Common Stock that is held by NRCG as treasury stock or that is owned by NRCG, Rooster Merger Sub or any other subsidiary of the Company or NRCG immediately prior to the applicable Effective Time will cease to be outstanding and will be cancelled and retired and will cease to exist, and no consideration will be delivered in exchange therefor.

In addition, in the Rooster Merger, each share of 7.00% Series A Convertible Cumulative Preferred Stock, par value $0.0001 per share, of NRCG (the “NRCG Series A Preferred Stock”) will be converted into, and become exchangeable for the right to receive that number of shares of Holdco Common Stock equal to (1) that number of shares of NRCG Common Stock that such share of NRCG Series A Preferred Stock could be converted into at the applicable Effective Time (including Fundamental Change Additional Shares and Accumulated Dividends (each, as defined in the Certificate of Designations, Preferences, Rights and Limitations of NRCG Series A Preferred Stock, dated as of October 17, 2018 and corrected on October 23, 2018 (the “NRCG Certificate of Designations”) establishing the rights of the NRCG Series A Preferred Stock)) multiplied by (b) the NRCG Exchange Ratio; (2) any cash in lieu of fractional shares of Holdco Common Stock payable pursuant to the Merger Agreement; and (3) any dividends or other distributions to which the holder thereof becomes entitled to upon the surrender of such shares of NRCG Common Stock in accordance with the Merger Agreement.

At the closing of the Rooster Merger, in respect of each outstanding warrant to purchase NRCG Common Stock (each, a “NRCG Warrant”) issued pursuant to that certain Warrant Agreement, dated as of June 22, 2017, between Continental Stock Transfer & Trust Company and NRCG, Holdco will issue a replacement warrant (each, a “Replacement Warrant”) to each holder providing that such Replacement Warrant will be exercisable for a number of shares of Holdco Common Stock equal to the product of (1) the number of shares of NRCG Common Stock that would have been issuable upon the exercise of the NRCG Warrant immediately prior to the effective time of the Rooster Merger and (2) the NRCG Exchange Ratio, at an exercise price equal to the quotient obtained by dividing (a) the pre-merger exercise price ($11.50 per share) by (b) the NRCG Exchange Ratio.

The closing of the Mergers, which is currently anticipated to occur during the fourth quarter of 2019, is subject to certain closing conditions, including (1) requisite approvals of the Company’s and NRCG’s stockholders, (2) the absence of certain legal impediments to the consummation of the Mergers, (3) the approval of the shares of Holdco Common Stock to be issued as consideration in the Mergers for listing on the Nasdaq Global Select Market, (4) effectiveness of the registration statement on Form S-4 registering the shares of Holdco Common Stock to be issued in connection with the Mergers, the Replacement Warrants and the shares of Holdco Common Stock underlying the Replacement Warrants, which includes a joint proxy statement of the Company and NRCG and a prospectus of Holdco (the “Proxy Statement”), (5) subject to certain exceptions, the accuracy of the representations, warranties and compliance with the covenants of each party to the Merger Agreement and (6) written tax opinions from the Company’s counsel and NRCG’s counsel.

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REVENUES

6 Months Ended

Jun. 30, 2019

REVENUES

REVENUES

NOTE 2.     REVENUES

Our operations are managed in two reportable segments, Environmental Services and Field & Industrial Services, reflecting our internal reporting structure and nature of services offered. See Note 17 for additional information on our operating segments.

Effective December 31, 2018, we changed our presentation of disaggregated revenues to align with changes in how we manage our service lines within our Field & Industrial Services segment. Revenues previously combined and reported as Technical Services are now disaggregated into two service lines, Small Quantity Generation (“SQG”) and Total Waste Management (“TWM”) and certain revenues formerly classified as Technical Services are now included in Remediation. Also, marine terminal services revenues, formerly classified as Other, are now included in Industrial Services. Effective January 1, 2019, Emergency Response revenues, formerly classified as Other, are now presented as a discrete service line. We also conformed the allocation of intercompany revenues between Treatment & Disposal Revenue and Services Revenue to be consistent across both segments. Throughout this Quarterly Report on Form 10-Q, our disaggregated revenues for all periods presented have been recast to reflect these changes.

The following table presents our revenue disaggregated by our reportable segments and service lines:

	Three Months Ended June 30, 2019
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Total
Treatment & Disposal Revenue (1)	$	90,379	$	3,133	$	93,512
Services Revenue:
Transportation and Logistics (2)		22,465		12,760		35,225
Industrial Services (3)		—		4,963		4,963
Small Quantity Generation (4)		—		9,326		9,326
Total Waste Management (5)		—		8,004		8,004
Remediation (6)		—		889		889
Emergency Response (7)		—		3,180		3,180
Other (8)		—		703		703
Revenue	$	112,844	$	42,958	$	155,802

	Three Months Ended June 30, 2018
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Total
Treatment & Disposal Revenue (1)	$	78,093	$	2,902	$	80,995
Services Revenue:
Transportation and Logistics (2)		20,867		7,598		28,465
Industrial Services (3)		—		4,506		4,506
Small Quantity Generation (4)		—		9,138		9,138
Total Waste Management (5)		—		9,019		9,019
Remediation (6)		—		3,968		3,968
Emergency Response (7)		—		749		749
Other (8)		—		72		72
Revenue	$	98,960	$	37,952	$	136,912

	Six Months Ended June 30, 2019
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Total
Treatment & Disposal Revenue (1)	$	168,092	$	5,929	$	174,021
Services Revenue:
Transportation and Logistics (2)		37,085		19,852		56,937
Industrial Services (3)		—		10,980		10,980
Small Quantity Generation (4)		—		17,515		17,515
Total Waste Management (5)		—		16,719		16,719
Remediation (6)		—		2,616		2,616
Emergency Response (7)				6,226		6,226
Other (8)		—		1,825		1,825
Revenue	$	205,177	$	81,662	$	286,839

	Six Months Ended June 30, 2018
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Total
Treatment & Disposal Revenue (1)	$	150,802	$	5,549	$	156,351
Services Revenue:
Transportation and Logistics (2)		34,629		13,248		47,877
Industrial Services (3)		—		8,385		8,385
Small Quantity Generation (4)		—		17,465		17,465
Total Waste Management (5)		—		19,241		19,241
Remediation (6)		—		6,158		6,158
Emergency Response (7)				1,391		1,391
Other (8)		—		103		103
Revenue	$	185,431	$	71,540	$	256,971

(1) We categorize our treatment and disposal revenue as either “Base Business” or “Event Business” based on the underlying nature of the revenue source. We define Event Business as non-recurring projects that are expected to equal or exceed 1,000 tons, with Base Business defined as all other business not meeting the definition of Event Business. For the three months ended June 30, 2019 and 2018, 23% and 19%, respectively, of our treatment and disposal revenue was derived from Event Business projects. Base Business revenue accounted for 77% and 81% of our treatment and disposal revenue for the three months ended June 30, 2019 and 2018, respectively. For the six months ended June 30, 2019 and 2018, 19% and 18%, respectively, of our treatment and disposal revenue was derived from Event Business projects. Base Business revenue accounted for 81% and 82% of our treatment and disposal revenue for the six months ended June 30, 2019 and 2018, respectively.

(2) Includes collection and transportation of non-hazardous and hazardous waste.

(3) Includes industrial cleaning and maintenance for refineries, chemical plants, steel and automotive plants, marine terminals and refinery services such as tank cleaning and temporary storage.

(4) Includes retail services, laboratory packing, less-than-truck-load service and household hazardous waste collection. Contracts for Small Quantity Generation may extend beyond one year and a portion of the transaction price can be fixed.

(5) Through our TWM program, customers outsource the management of their waste compliance program to us, allowing us to organize and coordinate their waste management disposal activities and environmental compliance. TWM contracts may extend beyond one year and a portion of the transaction price can be fixed.

(6) Includes site assessment, onsite treatment, project management and remedial action planning and execution. Contracts for Remediation may extend beyond one year and a portion of the transaction price can be fixed.

(7) Includes spill response, waste analysis and treatment and disposal planning.

(8) Includes equipment rental and other miscellaneous services.

We provide services in the United States and Canada. The following table presents our revenue disaggregated by our reportable segments and geographic location where the underlying services were performed:

	Three Months Ended June 30, 2019						Three Months Ended June 30, 2018
			Field &						Field &
	Environmental		Industrial				Environmental		Industrial
$s in thousands	Services		Services		Total		Services		Services		Total
United States	$	85,785	$	42,958	$	128,743	$	84,917	$	37,952	$	122,869
Canada		27,059		—		27,059		14,043		—		14,043
Total revenue	$	112,844	$	42,958	$	155,802	$	98,960	$	37,952	$	136,912

	Six Months Ended June 30, 2019						Six Months Ended June 30, 2018
			Field &						Field &
	Environmental		Industrial				Environmental		Industrial
$s in thousands	Services		Services		Total		Services		Services		Total
United States	$	163,144	$	81,662	$	244,806	$	159,903	$	71,540	$	231,443
Canada		42,033		—		42,033		25,528		—		25,528
Total revenue	$	205,177	$	81,662	$	286,839	$	185,431	$	71,540	$	256,971

Deferred Revenue

We record deferred revenue when cash payments are received, or advance billings are charged, prior to performance of services. Deferred revenue includes waste that has been received but not yet treated or disposed, and is recognized when services are performed. We recognized $1.5 million of revenue during each of the three month periods ended June 30, 2019 and 2018 that was included in the deferred revenue balance at the beginning of each year. During the six months ended June 30, 2019 and 2018, we recognized $9.0 million and $7.8 million of revenue, respectively, that was included in the deferred revenue balance at the beginning of each year.

Receivables

Our receivables include invoiced and unbilled amounts where the Company has an unconditional right to payment.

Principal versus Agent Considerations

The Company commonly contracts with third-parties to perform certain waste-related services that we have promised in our customer contracts. We consider ourselves the principal in these arrangements as we direct the timing, nature and pricing of the services ultimately provided by the third-party to the customer.

Costs to obtain a contract

The Company pays sales commissions to employees, which qualify as costs to obtain a contract. Sales commissions are expensed as incurred as the commissions are earned by the employee and paid by the Company over time as the related revenue is recognized.

Practical Expedients and Optional Exemptions

Our payment terms may vary based on type of service or customer; however, we do not adjust the promised amount of consideration in our contracts for the time value of money as payment terms extended to our customers do not exceed one year and are not considered a significant financing component in our contracts.

We do not disclose the value of unsatisfied performance obligations as contracts with an original expected length of more than one year and contracts for which we do not recognize revenue at the amount to which we have the right to invoice for services performed is insignificant and the aggregate amount of fixed consideration allocated to unsatisfied performance obligations is not material.

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BUSINESS COMBINATION

6 Months Ended

Jun. 30, 2019

BUSINESS COMBINATION

BUSINESS COMBINATION

NOTE 3.     BUSINESS COMBINATION

Ecoserv Industrial Disposal, LLC

On November 14, 2018, the Company acquired Ecoserv Industrial Disposal, LLC (“Winnie”), which provides non-hazardous industrial wastewater disposal solutions and employs deep-well injection technology in the southern United States.

The following table summarizes the consideration paid for Winnie and the fair value estimates of assets acquired and liabilities assumed, recognized at the acquisition date, with purchase price allocation adjustments since the preliminary purchase price allocation as previously disclosed as of December 31, 2018:

	Purchase Price Allocation
	December 31,				June 30,
$s in thousands	2018		Adjustments		2019
Current assets	$	1,923	$	(63)	$	1,860
Property and equipment		6,300		(2,324)		3,976
Identifiable intangible assets		66,600		(100)		66,500
Current liabilities		(755)		—		(755)
Other liabilities		(512)		—		(512)
Total identifiable net assets		73,556		(2,487)		71,069
Goodwill		13,573		2,586		16,159
Total purchase price	$	87,129	$	99	$	87,228

Purchase price allocation adjustments relate primarily to the receipt of additional information regarding the fair values of property and equipment, a post-closing price adjustment based on working capital requirements and residual goodwill.

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

6 Months Ended

Jun. 30, 2019

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS).

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

NOTE 4.     ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Changes in accumulated other comprehensive income (loss) (“AOCI”) consisted of the following:

	Foreign		Unrealized Gain
	Currency		(Loss) on Interest
$s in thousands	Translation		Rate Hedge		Total
Balance at December 31, 2018	$	(14,697)	$	906	$	(13,791)
Other comprehensive income (loss) before reclassifications, net of tax		3,369		(1,658)		1,711
Amounts reclassified out of AOCI, net of tax (1)		—		(210)		(210)
Other comprehensive income, net		3,369		(1,868)		1,501
Balance at June 30, 2019	$	(11,328)	$	(962)	$	(12,290)

(1) Before-tax reclassifications of $127,000 ($100,000 after-tax) and $266,000 ($210,000 after-tax) for the three and six months ended June 30, 2019, were included as a reduction of Interest expense in the Company’s consolidated statements of operations. Amounts relate to the Company’s interest rate swap which is designated as a cash flow hedge. Changes in fair value of the swap recognized in AOCI are reclassified to interest expense when hedged interest payments on the underlying long-term debt are made. Amounts in AOCI expected to be recognized as a reduction of interest expense over the next 12 months total approximately $509,000 ($402,000 after-tax).

	Foreign		Unrealized Gain
	Currency		(Loss) on Interest
$s in thousands	Translation		Rate Hedge		Total
Balance at December 31, 2017	$	(8,603)	$	(501)	$	(9,104)
Other comprehensive income (loss) before reclassifications, net of tax		(3,468)		1,913		(1,555)
Amounts reclassified out of AOCI, net of tax (2)		—		310		310
Other comprehensive income, net		(3,468)		2,223		(1,245)
Balance at June 30, 2018	$	(12,071)	$	1,722	$	(10,349)

(2) Before-tax reclassifications of $119,000 ($94,000 after-tax) and $392,000 ($310,000 after-tax) for the three and six months ended June 30, 2018, were included in Interest expense in the Company’s consolidated statements of operations. Amounts relate to the Company’s interest rate swap which is designated as a cash flow hedge. Changes in fair value of the swap recognized in AOCI are reclassified to interest expense when hedged interest payments on the underlying long-term debt are made.

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CONCENTRATIONS AND CREDIT RISK

6 Months Ended

Jun. 30, 2019

CONCENTRATIONS AND CREDIT RISK

CONCENTRATIONS AND CREDIT RISK

NOTE 5.     CONCENTRATIONS AND CREDIT RISK

Major Customers

No customer accounted for more than 10% of total revenue for the three or six months ended June 30, 2019 or 2018, respectively. No customer accounted for more than 10% of total trade receivables as of June 30, 2019 or December 31, 2018.

Credit Risk Concentration

We maintain most of our cash and cash equivalents with nationally recognized financial institutions. Substantially all balances are uninsured and are not used as collateral for other obligations. Concentrations of credit risk on accounts receivable are believed to be limited due to the number, diversification and character of the obligors and our credit evaluation process.

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RECEIVABLES

6 Months Ended

Jun. 30, 2019

RECEIVABLES

RECEIVABLES

NOTE 6.     RECEIVABLES

Receivables consisted of the following:

	June 30,		December 31,
$s in thousands	2019		2018
Trade	$	115,935	$	118,909
Unbilled revenue		27,741		26,538
Other		8,887		2,241
Total receivables		152,563		147,688
Allowance for doubtful accounts		(2,526)		(2,998)
Receivables, net	$	150,037	$	144,690

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FAIR VALUE MEASUREMENTS

6 Months Ended

Jun. 30, 2019

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

NOTE 7.     FAIR VALUE MEASUREMENTS

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities recorded at fair value are categorized using defined hierarchical levels directly related to the amount of subjectivity associated with the inputs to fair value measurements, as follows:

Level 1 - Quoted prices in active markets for identical assets or liabilities;

Level 2 - Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable;

Level 3 - Unobservable inputs in which little or no market activity exists, requiring an entity to develop its own assumptions that market participants would use to value the asset or liability.

The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, restricted cash and investments, accounts payable, accrued liabilities, debt and interest rate swap agreements. The estimated fair value of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their carrying value due to the short-term nature of these instruments.

The Company estimates the fair value of its variable-rate debt using Level 2 inputs, such as interest rates, related terms and maturities of similar obligations. At June 30, 2019, the carrying value of the Company’s variable-rate debt approximates fair value due to the short-term nature of the interest rates.

The Company’s assets and liabilities measured at fair value on a recurring basis consisted of the following:

	June 30, 2019
	Quoted Prices in		Other Observable		Unobservable
	Active Markets		Inputs		Inputs
$s in thousands	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Fixed-income securities (1)	$	1,979	$	2,224	$	—	$	4,203
Money market funds (2)		818		—		—		818
Total	$	2,797	$	2,224	$	—	$	5,021
Liabilities:
Interest rate swap agreement (3)	$	—	$	1,217	$	—	$	1,217
Total	$	—	$	1,217	$	—	$	1,217

	December 31, 2018
	Quoted Prices in		Other Observable		Unobservable
	Active Markets		Inputs		Inputs
$s in thousands	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Fixed-income securities (1)	$	1,561	$	2,596	$	—	$	4,157
Money market funds (2)		784		—		—		784
Interest rate swap agreement (3)		—		1,147				1,147
Total	$	2,345	$	3,743	$	—	$	6,088

(1) We invest a portion of our Restricted cash and investments in fixed-income securities, including U.S. Treasury and U.S. agency securities. We measure the fair value of U.S. Treasury securities using quoted prices for identical assets in active markets. We measure the fair value of U.S. agency securities using observable market activity for similar assets. The fair value of our fixed-income securities approximates our cost basis in the investments.

(2) We invest a portion of our Restricted cash and investments in money market funds. We measure the fair value of these money market fund investments using quoted prices for identical assets in active markets. Money market funds are considered restricted cash for purposes of reconciling the beginning-of-period and end-of-period amounts presented in the Company’s consolidated statements of cash flows.

(3) In order to manage interest rate exposure, we entered into an interest rate swap agreement in October 2014 that effectively converts a portion of our variable-rate debt to a fixed interest rate. The swap is designated as a cash flow hedge, with gains and losses deferred in other comprehensive income to be recognized as an adjustment to interest expense in the same period that the hedged interest payments affect earnings. The interest rate swap has an effective date of December 31, 2014 with an initial notional amount of $250.0 million. The fair value of the interest rate swap agreement represents the difference in the present value of cash flows calculated at the contracted interest rates and at current market interest rates at the end of the period. We calculate the fair value of the interest rate swap agreement quarterly based on the quoted market price for the same or similar financial instruments. The fair value of the interest rate swap agreement is included in Other long-term liabilities and Other assets in the Company’s consolidated balance sheet as of June 30, 2019 and December 31, 2018, respectively.

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PROPERTY AND EQUIPMENT

6 Months Ended

Jun. 30, 2019

PROPERTY AND EQUIPMENT

PROPERTY AND EQUIPMENT

NOTE 8.     PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:

	June 30,		December 31,
$s in thousands	2019		2018
Cell development costs	$	147,059	$	146,155
Land and improvements		53,067		50,481
Buildings and improvements		91,743		91,358
Railcars		17,299		17,299
Vehicles and other equipment		162,388		154,014
Construction in progress		26,546		14,554
Total property and equipment		498,102		473,861
Accumulated depreciation and amortization		(232,482)		(215,418)
Property and equipment, net	$	265,620	$	258,443

Depreciation and amortization expense for the three months ended June 30, 2019 and 2018 was $9.1 million and $7.0 million, respectively. Depreciation and amortization expense for the six months ended June 30, 2019 and 2018 was $17.3 million and $13.6 million, respectively.

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LEASES

6 Months Ended

Jun. 30, 2019

LEASES

LEASES

NOTE 9.   LEASES

We lease certain facilities, office space, land and equipment. Our lease payments are primarily fixed, but also include variable payments that are based on usage of the leased asset. Initial lease terms range from one to 15 years, and may include one or more options to renew, with renewal terms extending a lease up to 40 years. None of our renewal options are considered reasonably certain to be exercised. Provisions for residual value guarantees exist in some of our equipment leases, however amounts associated with these provisions are not material. Our leases do not include any material restrictive covenants.

Leases with an initial term of 12 months or less are not recorded on the balance sheet and expense is recognized on a straight-line basis over the lease term. We combine lease and nonlease components in our leases, except for equipment leases that include maintenance related services. We use the rate implicit in the lease, when available, to discount lease payments to present value. However, many of our leases do not provide a readily determinable implicit rate and we estimate our incremental borrowing rate to discount payments based on information available at lease commencement.

Lease assets and liabilities consisted of the following:

$s in thousands	June 30, 2019
Assets:
Operating right-of-use assets (1)	$	17,575
Finance right-of-use assets (2)		3,028
Total	$	20,603
Liabilities:
Current:
Operating (3)	$	4,932
Finance (4)		837
Long-term:
Operating (5)		12,553
Finance (6)		2,269
Total	$	20,591

(1) Included in Operating lease assets in the Company’s consolidated balance sheets.

(2) Included in Property and equipment, net in the Company’s consolidated balance sheets. Finance right-of-use assets are recorded net of accumulated amortization of $1.5 million as of June 30, 2019.

(3) Included in Current portion of operating lease liabilities in the Company’s consolidated balance sheets.

(4) Included in Accrued liabilities in the Company’s consolidated balance sheets.

(5) Included in Long-term operating lease liabilities in the Company’s consolidated balance sheets.

(6) Included in Other long-term liabilities in the Company’s consolidated balance sheets.

Lease expense consisted of the following:

	Three Months Ended		Six Months Ended
$s in thousands	June 30, 2019		June 30, 2019
Operating lease cost (1)	$	1,713	$	3,455
Finance lease cost:
Amortization of leased assets (2)		248		476
Interest on lease liabilities (3)		30		50
Total	$	1,991	$	3,981

(1) Included in Direct operating costs and Selling, general, and administrative expenses in the Company’s consolidated statements of operations. Operating lease cost includes short-term leases, excluding expenses relating to leases with a term of one month or less, which are not material. Operating lease cost excludes variable lease costs which are not material.

(2) Included in Direct operating costs in the Company’s consolidated statements of operations.

(3) Included in Interest expense in the Company’s consolidated statements of operations.

Supplemental cash flow information related to our leases is as follows:

	Six Months Ended
$s in thousands	June 30, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	3,238
Operating cash flows from finance leases		50
Financing cash flows from finance leases		408
Non-cash investing and financing activities:
Right-of-use assets obtained in exchange for new operating lease liabilities	$	2,397
Right-of-use assets obtained in exchange for new finance lease liabilities		1,844

Other information related to our leases is as follows:

	June 30, 2019
Weighted-average remaining lease term (years):
Operating leases		5.6
Finance leases		3.7
Weighted-average discount rate:
Operating leases		4.38	%
Finance leases		3.71	%

The Company’s maturity analysis of its lease liabilities as of June 30, 2019 is as follows:

	Operating		Finance
$s in thousands	Leases		Leases		Total
2019 (excluding the six months ended June 30, 2019)	$	2,936	$	484	$	3,420
2020		4,110		792		4,902
2021		3,663		619		4,282
2022		2,367		548		2,915
2023		1,886		612		2,498
Thereafter		5,157		354		5,511
Total	$	20,119	$	3,409	$	23,528
Less: Interest		2,634		303		2,937
Present value of lease liabilities	$	17,485	$	3,106	$	20,591

Future minimum lease payments on non-cancellable operating leases as of December 31, 2018 are as follows:

$s in thousands	Payments
2019	$	5,638
2020		3,644
2021		3,184
2022		1,885
2023		1,457
Thereafter		5,065
	$	20,873

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GOODWILL AND INTANGIBLE ASSETS

6 Months Ended

Jun. 30, 2019

GOODWILL AND INTANGIBLE ASSETS

GOODWILL AND INTANGIBLE ASSETS

NOTE 10.     GOODWILL AND INTANGIBLE ASSETS

Changes in goodwill for the six months ended June 30, 2019 consisted of the following:

					Field &
	Environmental				Industrial
	Services				Services
			Accumulated				Accumulated
$s in thousands	Gross		Impairment		Gross		Impairment		Total
Balance at December 31, 2018	$	162,816	$	(6,870)	$	51,231	$	—	$	207,177
Winnie purchase price allocation adjustment		2,586		—		—		—		2,586
Foreign currency translation		703		—		—		—		703
Balance at June 30, 2019	$	166,105	$	(6,870)	$	51,231	$	—	$	210,466

Intangible assets, net consisted of the following:

	June 30, 2019						December 31, 2018
			Accumulated						Accumulated
$s in thousands	Cost		Amortization		Net		Cost		Amortization		Net
Amortizing intangible assets:
Permits, licenses and lease	$	165,600	$	(16,817)	$	148,783	$	164,840	$	(14,804)	$	150,036
Customer relationships		99,396		(28,948)		70,448		99,241		(25,676)		73,565
Technology - formulae and processes		6,951		(1,897)		5,054		6,672		(1,714)		4,958
Customer backlog		3,652		(1,839)		1,813		3,652		(1,656)		1,996
Developed software		2,894		(1,737)		1,157		2,884		(1,581)		1,303
Non-compete agreements		1,542		(1,076)		466		1,542		(875)		667
Internet domain and website		536		(142)		394		536		(128)		408
Database		387		(181)		206		384		(167)		217
Total amortizing intangible assets		280,958		(52,637)		228,321		279,751		(46,601)		233,150
Non-amortizing intangible assets:
Permits and licenses		46,415		—		46,415		46,391		—		46,391
Tradename		130		—		130		125		—		125
Total intangible assets	$	327,503	$	(52,637)	$	274,866	$	326,267	$	(46,601)	$	279,666

Amortization expense for the three months ended June 30, 2019 and 2018 was $2.9 million and $2.3 million, respectively. Amortization expense for the six months ended June 30, 2019 and 2018 was $5.7 million and $4.6 million, respectively. Foreign intangible asset carrying amounts are affected by foreign currency translation.

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DEBT

6 Months Ended

Jun. 30, 2019

DEBT

DEBT

NOTE 11.     DEBT

Long-term debt consisted of the following:

	June 30,		December 31,
$s in thousands	2019		2018
Revolving credit facility	$	334,000	$	364,000
Long-term debt	$	334,000	$	364,000

2017 Credit Agreement

On April 18, 2017, the Company entered into a senior secured credit agreement (the “2017 Credit Agreement”) with Wells Fargo Bank, National Association (“Wells Fargo”), as administrative agent for the lenders, swingline lender and issuing lender, and Bank of America, N.A., as an issuing lender, that provides for a $500.0 million, five-year revolving credit facility (the “Revolving Credit Facility”), including a $75.0 million sublimit for the issuance of standby letters of credit and a $25.0 million sublimit for the issuance of swingline loans used to fund short-term working capital requirements. The 2017 Credit Agreement also contains an accordion feature whereby the Company may request up to $200.0 million of additional funds through an increase to the Revolving Credit Facility, through incremental term loans, or some combination thereof. The Company is pursuing an amendment to the 2017 Credit Agreement to, among other things, permit a $400.0 million term loan, which the Company intends to use in refinancing existing indebtedness of NRCG in connection with the Mergers and to pay the fees and expenses of the Company incurred in connection with the Mergers and the transactions in connection therewith.

The Revolving Credit Facility provides up to $500.0 million of revolving credit loans or letters of credit with the use of proceeds restricted solely for working capital and other general corporate purposes (including acquisitions and capital expenditures). Under the Revolving Credit Facility, revolving credit loans are available based on a base rate (as defined in the 2017 Credit Agreement) or LIBOR, at the Company’s option, plus an applicable margin which is determined according to a pricing grid under which the interest rate decreases or increases based on our ratio of funded debt to consolidated

earnings before interest, taxes, depreciation and amortization (as defined in the 2017 Credit Agreement), as set forth in the table below:

Total Net Leverage Ratio	LIBOR Rate Loans Interest Margin	Base Rate Loans Interest Margin
Equal to or greater than 3.25 to 1.00	2.00%	1.00%
Equal to or greater than 2.50 to 1.00, but less than 3.25 to 1.00	1.75%	0.75%
Equal to or greater than 1.75 to 1.00, but less than 2.50 to 1.00	1.50%	0.50%
Equal to or greater than 1.00 to 1.00, but less than 1.75 to 1.00	1.25%	0.25%
Less than 1.00 to 1.00	1.00%	0.00%

At June 30, 2019, the effective interest rate on the Revolving Credit Facility, after giving effect to the impact of our interest rate swap, was 3.61%. Interest only payments are due either quarterly or on the last day of any interest period, as applicable.

In October 2014, the Company entered into an interest rate swap agreement, effectively fixing the interest rate on $160.0 million, or 48%, of the Revolving Credit Facility borrowings as of June 30, 2019.

The Company is required to pay a commitment fee ranging from 0.175% to 0.35% on the average daily unused portion of the Revolving Credit Facility, with such commitment fee to be reduced based upon the Company’s total net leverage ratio (as defined in the 2017 Credit Agreement). The maximum letter of credit capacity under the Revolving Credit Facility is $75.0 million and the 2017 Credit Agreement provides for a letter of credit fee equal to the applicable margin for LIBOR loans under the Revolving Credit Facility. At June 30, 2019, there were $334.0 million of revolving credit loans outstanding on the Revolving Credit Facility. These revolving credit loans are due upon the earliest to occur of (a) April 18, 2022 (or, with respect to any lender, such later date as requested by us and accepted by such lender), (b) the date of termination of the entire revolving credit commitment (as defined in the 2017 Credit Agreement) by us, and (c) the date of termination of the revolving credit commitment and are presented as long-term debt in the consolidated balance sheets.  

The Company has entered into a sweep arrangement whereby day-to-day cash requirements in excess of available cash balances are advanced to the Company on an as-needed basis with repayments of these advances automatically made from subsequent deposits to our cash operating accounts (the “Sweep Arrangement”). Total advances outstanding under the Sweep Arrangement are subject to the $25.0 million swingline loan sublimit under the Revolving Credit Facility. The Company’s revolving credit loans outstanding under the Revolving Credit Facility are not subject to repayment through the Sweep Arrangement. As of June 30, 2019, there were no amounts outstanding subject to the Sweep Arrangement.

As of June 30, 2019, the availability under the Revolving Credit Facility was $160.3 million with $5.7 million of the Revolving Credit Facility issued in the form of standby letters of credit utilized as collateral for closure and post-closure financial assurance and other assurance obligations.

The Company may at any time and from time to time prepay revolving credit loans and swingline loans, in whole or in part, without premium or penalty, subject to the obligation to indemnify each of the lenders against any actual loss or expense (including any loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain a LIBOR rate loan (as defined in the 2017 Credit Agreement) or from fees payable to terminate the deposits from which such funds were obtained) with respect to the early termination of any LIBOR rate loan. The 2017 Credit Agreement provides for mandatory prepayment at any time if the revolving credit outstanding exceeds the revolving credit commitment (as such terms are defined in the 2017 Credit Agreement), in an amount equal to such excess. Subject to certain exceptions, the 2017 Credit Agreement provides for mandatory prepayment upon certain asset dispositions, casualty events and issuances of indebtedness.

Pursuant to (i) an unconditional guarantee agreement and (ii) a collateral agreement, each entered into by the Company and its domestic subsidiaries on April 18, 2017, the Company’s obligations under the 2017 Credit Agreement are (or will be) jointly and severally and fully and unconditionally guaranteed on a senior basis by all of the Company’s existing and certain future domestic subsidiaries and are secured by substantially all of the assets of the Company and the Company’s existing and certain future domestic subsidiaries (subject to certain exclusions), including 100% of the equity interests of

the Company’s domestic subsidiaries and 65% of the voting equity interests of the Company’s directly owned foreign subsidiaries (and 100% of the non-voting equity interests of the Company’s directly owned foreign subsidiaries).

The 2017 Credit Agreement contains customary restrictive covenants, subject to certain permitted amounts and exceptions, including covenants limiting the ability of the Company to incur additional indebtedness, pay dividends and make other restricted payments, repurchase shares of our outstanding stock and create certain liens. Upon the occurrence of an event of default (as defined in the 2017 Credit Agreement), among other things, amounts outstanding under the 2017 Credit Agreement may be accelerated and the commitments may be terminated.

The 2017 Credit Agreement also contains financial maintenance covenants, a maximum consolidated total net leverage ratio and a consolidated interest coverage ratio (as such terms are defined in the 2017 Credit Agreement). Our consolidated total net leverage ratio as of the last day of any fiscal quarter may not exceed 3.50 to 1.00, subject to certain exceptions. Our consolidated interest coverage ratio as of the last day of any fiscal quarter may not be less than 3.00 to 1.00.

At June 30, 2019, we were in compliance with all of the financial covenants in the 2017 Credit Agreement.

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CLOSURE AND POST-CLOSURE OBLIGATIONS

6 Months Ended

Jun. 30, 2019

CLOSURE AND POST-CLOSURE OBLIGATIONS

CLOSURE AND POST-CLOSURE OBLIGATIONS

NOTE 12.     CLOSURE AND POST-CLOSURE OBLIGATIONS

Our accrued closure and post-closure liability represents the expected future costs, including corrective actions, associated with closure and post-closure of our operating and non-operating disposal facilities. We record the fair value of our closure and post-closure obligations as a liability in the period in which the regulatory obligation to retire a specific asset is triggered. For our individual landfill cells, the required closure and post-closure obligations under the terms of our permits and our intended operation of the landfill cell are triggered and recorded when the cell is placed into service and waste is initially disposed in the landfill cell. The fair value is based on the total estimated costs to close the landfill cell and perform post-closure activities once the landfill cell has reached capacity and is no longer accepting waste. We perform periodic reviews of both non-operating and operating facilities and revise accruals for estimated closure and post-closure, remediation or other costs as necessary. Recorded liabilities are based on our best estimates of current costs and are updated periodically to include the effects of existing technology, presently enacted laws and regulations, inflation and other economic factors.

Changes to closure and post-closure obligations consisted of the following:

	Three Months Ended		Six Months Ended
$s in thousands	June 30, 2019		June 30, 2019
Closure and post-closure obligations, beginning of period	$	79,056	$	78,363
Accretion expense		1,133		2,258
Payments		(305)		(775)
Foreign currency translation		35		73
Closure and post-closure obligations, end of period		79,919		79,919
Less current portion		(2,231)		(2,231)
Long-term portion	$	77,688	$	77,688

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INCOME TAXES

6 Months Ended

Jun. 30, 2019

INCOME TAXES

INCOME TAXES

NOTE 13.   INCOME TAXES

Our effective tax rate for the three months ended June 30, 2019 was 29.2%, up from 24.4% for the three months ended June 30, 2018. Our effective tax rate for the six months ended June 30, 2019 was 28.6%, up from 25.7% for the six months ended June 30, 2018. The increase for the three and six months ended June 30, 2019, compared to the three and six months ended June 30, 2018, was primarily due to increased non-deductible expenses and higher effective state tax rates, partially offset by federal research and development credits. The change in the effective tax rate for the three and six months ended June 30, 2019 also reflects the impact of discrete events including the recognition of excess tax benefits related to employee stock compensation.

Gross unrecognized tax benefits, included in Other long-term liabilities in the consolidated balance sheets, were $616,000 and $555,000 as of June 30, 2019 and December 31, 2018, respectively. The gross unrecognized tax benefits, if recognized by the Company, will result in a reduction of approximately $544,000 to the provision for income taxes thereby favorably impacting the Company’s effective tax rate. We do not anticipate our total unrecognized tax benefits to increase or decrease materially within the next twelve months. We recognize interest assessed by taxing authorities or interest associated with uncertain tax positions as a component of interest expense. We recognize any penalties assessed by taxing authorities or penalties associated with uncertain tax positions as a component of Selling, general and administrative expenses.

We file a consolidated U.S. federal income tax return with the Internal Revenue Service (“IRS”) as well as tax returns in various states, Canada, and Mexico. The Company is subject to examination by the IRS for tax years 2014 through 2018. The Company is currently under examination by the state of Idaho for years 2014 through 2018 and the state of Texas for the year 2014. We may be subject to examinations by various state and local taxing jurisdictions for tax years 2014 through 2018. The Company has no significant foreign jurisdiction audits underway. The tax years 2014 through 2018 remain subject to examination by foreign jurisdictions.

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EARNINGS PER SHARE

6 Months Ended

Jun. 30, 2019

EARNINGS PER SHARE

EARNINGS PER SHARE

NOTE 14.   EARNINGS PER SHARE

	Three Months Ended June 30,
	2019				2018
$s and shares in thousands, except per share amounts	Basic		Diluted		Basic		Diluted
Net income	$	15,491	$	15,491	$	13,220	$	13,220
Weighted average basic shares outstanding		22,006		22,006		21,867		21,867
Dilutive effect of share-based awards				202				157
Weighted average diluted shares outstanding				22,208				22,024
Earnings per share	$	0.70	$	0.70	$	0.60	$	0.60
Anti-dilutive shares excluded from calculation				92				58

	Six Months Ended June 30,
	2019				2018
$s and shares in thousands, except per share amounts	Basic		Diluted		Basic		Diluted
Net income	$	23,534	$	23,534	$	22,463	$	22,463
Weighted average basic shares outstanding		21,997		21,997		21,835		21,835
Dilutive effect of share-based awards				206				156
Weighted average diluted shares outstanding				22,203				21,991
Earnings per share	$	1.07	$	1.06	$	1.03	$	1.02
Anti-dilutive shares excluded from calculation				86				76

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EQUITY

6 Months Ended

Jun. 30, 2019

EQUITY

EQUITY

NOTE 15.   EQUITY

Stock Repurchase Program

On June 1, 2016, the Company’s Board of Directors authorized the repurchase of $25.0 million of the Company’s outstanding common stock. Repurchases may be made from time to time in the open market or through privately negotiated transactions. The timing of any repurchases will be based upon prevailing market conditions and other factors. The Company did not repurchase any shares of common stock under the repurchase program during the three or six months ended June 30, 2019. On May 29, 2018 the repurchase program was extended and will remain in effect until June 6, 2020, unless further extended by our Board of Directors.

Omnibus Incentive Plan

On May 27, 2015, our stockholders approved the Omnibus Incentive Plan (“Omnibus Plan”), which was approved by our Board of Directors on April 7, 2015. The Omnibus Plan was developed to provide additional incentives through equity ownership in the Company and, as a result, encourage employees and directors to contribute to our success. The Omnibus Plan provides, among other things, the ability for the Company to grant restricted stock, performance stock, options, stock appreciation rights, restricted stock units (“RSUs”), performance stock units (“PSUs”) and other share-based awards or cash awards to officers, employees, consultants and non-employee directors. Subsequent to the approval of the Omnibus Plan in May 2015, we stopped granting equity awards under our 2008 Stock Option Incentive Plan and our 2006 Restricted Stock Plan (collectively, the “Previous Plans”). The Previous Plans will remain in effect solely for the settlement of awards granted under the Previous Plans. No shares that are reserved but unissued under the Previous Plans or that are outstanding under the Previous Plans and reacquired by the Company for any reason will be available for issuance under the Omnibus Plan. The Omnibus Plan expires on April 7, 2025 and authorizes 1,500,000 shares of common stock for grant over the life of the Omnibus Plan. As of June 30, 2019, 873,117 shares of common stock remain available for grant under the Omnibus Plan.

PSUs, RSUs and Restricted Stock

On March 1, 2019, the Company granted 17,111 PSUs to certain employees. Each PSU represents the right to receive, on the settlement date, one share of the Company’s common stock. The total number of PSUs each participant is eligible to earn ranges from 0% to 300% of the target number of PSUs granted. The actual number of PSUs that will vest and be settled in shares is determined at the end of a three-year performance period beginning January 1, 2019, based on adjusted earnings per share and return on invested capital relative to established targets with an additional adjustment based on total stockholder return relative to a set of peer companies. The fair value of the PSUs estimated on the grant date using a Monte Carlo simulation was $58.20 per unit. Compensation expense is recorded over the awards’ vesting period.

Assumptions used in the Monte Carlo simulation to calculate the fair value of the PSUs granted in 2019 are as follows:

	2019
Stock price on grant date	$	58.40
Expected term		3.0	years
Expected volatility		30	%
Risk-free interest rate		2.5	%
Expected dividend yield		1.1	%

A summary of our PSU, restricted stock and RSU activity for the six months ended June 30, 2019 is as follows:

	PSUs			Restricted Stock			RSUs
		Weighted			Weighted			Weighted
		Average			Average			Average
		Grant Date			Grant Date			Grant Date
	Shares	Fair Value		Shares	Fair Value		Shares	Fair Value
Outstanding as of December 31, 2018	39,200	$	55.48	74,988	$	46.74	66,785	$	53.77
Granted	17,111		58.20	27,800		62.59	33,020		56.21
Vested	(13,600)		41.22	(39,234)		43.77	(26,362)		48.28
Cancelled, expired or forfeited	—		—	—		—	(243)		45.66
Outstanding as of June 30, 2019	42,711	$	61.11	63,554	$	55.50	73,200	$	56.88

During the six months ended June 30, 2019, 13,600 PSUs vested and PSU holders earned 19,414 shares of the Company’s common stock.

Stock Options

A summary of our stock option activity for the six months ended June 30, 2019 is as follows:

		Weighted
		Average
		Exercise
	Shares	Price
Outstanding as of December 31, 2018	236,503	$	44.93
Granted	41,100		63.36
Exercised	(3,246)		42.29
Cancelled, expired or forfeited	(1,540)		43.55
Outstanding as of June 30, 2019	272,817	$	47.74
Exercisable as of June 30, 2019	191,756	$	43.83

During the six months ended June 30, 2019, option holders tendered 2,252 options in connection with options exercised via net share settlement.

Treasury Stock

During the six months ended June 30, 2019, the Company repurchased 14,462 shares of the Company’s common stock in connection with the net share settlement of employee equity awards at an average cost of $63.34 per share. During the six months ended June 30, 2019, the Company issued 7,800 treasury shares related to restricted stock awards at an average cost of $57.77 per share.

Dividends

The Company paid dividends of $0.18 per common share during each of the three months ended June 30, 2019 and 2018 and paid dividends of $0.36 per common share during each of the six months ended June 30, 2019 and 2018.

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COMMITMENTS AND CONTINGENCIES

6 Months Ended

Jun. 30, 2019

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

NOTE 16.   COMMITMENTS AND CONTINGENCIES

Litigation and Regulatory Proceedings

In the ordinary course of business, we are involved in judicial and administrative proceedings involving federal, state, provincial or local governmental authorities, including regulatory agencies that oversee and enforce compliance with permits. Fines or penalties may be assessed by our regulators for non-compliance. Actions may also be brought by individuals or groups in connection with permitting of planned facilities, modification or alleged violations of existing permits, or alleged damages suffered from exposure to hazardous substances purportedly released from our operated sites, as well as other litigation. We maintain insurance intended to cover property and damage claims asserted as a result of our operations. Periodically, management reviews and may establish reserves for legal and administrative matters, or other fees expected to be incurred in relation to these matters.

On July 23, 2019, SBTS, LLC (“SBTS”) filed a complaint captioned SBTS, LLC vs. NRC Group Holdings Corp. (Civil Action No. 2019-0566-JTL), in the Court of Chancery of the State of Delaware (the “Court of Chancery”) against NRCG, NRC Group and US Ecology (the “Complaint”). In the Complaint, SBTS alleges that (1) the exchange (the “Preferred Exchange”) of the NRCG Series A Preferred Stock pursuant to the Merger Agreement breaches certain provisions of the NRCG Series A Certificate of Designations, (2) the Preferred Exchange would violate Section 242 of the Delaware General Corporation Law (“DGCL”), (3) SBTS would suffer irreparable harm if NRCG and US Ecology are not enjoined from consummating the transactions contemplated by the Merger Agreement and (4) US Ecology had knowledge of the relevant sections of the NRCG Series A Certificate of Designations and still required the Merger Agreement to include the Preferred Exchange.

In the Complaint, SBTS requests that the Court of Chancery (1) render a declaratory judgment that (a) the terms of the Merger Agreement violate certain provisions of the NRCG Series A Certificate of Designations, (b) the removal of the NRCG Series A Preferred Stock designee from the NRCG Board violates NRCG’s Certificate of Incorporation and the NRCG Series A Certificate of Designations, and (c) the terms of the Merger Agreement violate Section 242 of the DGCL, (2) enjoin NRCG from convening a vote of its common stockholders to adopt the Merger Agreement, (3) enjoin NRCG and US Ecology from consummating the transactions contemplated by the Merger Agreement, (4) find US Ecology liable for tortious interference with a contract and award SBTS the damages caused by US Ecology’s actions, (5) award SBTS costs and expenses in connection with the action and (6) grant SBTS any such further relief as justice and its cause may require.

As previously disclosed, NRCG and US Ecology believe that the allegations in the Complaint are without merit and that the Preferred Exchange of the NRCG Series A Preferred Stock as contemplated in the Merger Agreement is in accordance with the NRCG Series A Certificate of Designations and the DGCL.

On November 17, 2018, an explosion occurred at our Grand View, Idaho facility, resulting in one employee fatality and injuries to other employees. The incident severely damaged the facility’s primary waste-treatment building as well as surrounding waste handling, waste storage, maintenance and administrative support structures, resulting in the closure of the entire facility that remained in effect through January 2019. We resumed landfill operations at our Grand View, Idaho facility in first quarter of 2019 and resumed operations of our secondary waste-treatment facility in the second quarter of 2019. Reconstruction of the primary waste-treatment building is currently underway. In addition to conducting our own investigation into the incident, we are fully cooperating with government agencies, including Idaho Department of Environmental Quality (“IDEQ”) and the U.S. Environmental Protection Agency (“USEPA”) to support their comprehensive and independent investigations of the incident. We cannot presently estimate the potential liability related to the incident and, therefore, no amounts related to such claims have been recorded in our financial statements as of June 30, 2019. We have not been named as a defendant in any civil action relating to the incident. As a result of the Occupational Safety and Health Administration’s (“OSHA”) inspection following the incident, OSHA issued a Citation and Notification of Penalty on May 6, 2019. We are currently contesting the Citation and Notification of Penalty before the Occupational Safety and Health Review Commission and the contested penalty is not material. We maintain workers’ compensation insurance, business interruption insurance and liability insurance for personal injury, property and casualty damage. We believe that any potential third-party claims associated with the explosion, in excess of our deductibles, are expected to be resolved primarily through our insurance policies. Although we carry business interruption insurance, a disruption of our business caused by a casualty event, including the full and partial closure of our Grand View, Idaho facility, may result in the loss of business, profits or customers during the time of such closure. Accordingly, our insurance policies may not fully compensate us for these losses.

The Company received $9.5 million of property-related insurance payments in the first six months of 2019 related to the incident at our Grand View, Idaho facility in the fourth quarter of 2018. The Company recognized $9.2 million of property-related insurance recovery gains in the first six months of 2019. The Company is actively working with its insurance companies on comprehensive property and business interruption insurance claims. Although the Company has recognized certain insurance recoveries related to expenses incurred to continue limited operations at the facility, as of June 30, 2019, the Company has neither received nor recognized any business interruption insurance recoveries related to lost profits as a result of lost business or customers.

Other than as described above, we are not currently a party to any material pending legal proceedings and are not aware of any other claims that could, individually or in the aggregate, have a materially adverse effect on our financial position, results of operations or cash flows.

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OPERATING SEGMENTS

6 Months Ended

Jun. 30, 2019

OPERATING SEGMENTS

OPERATING SEGMENTS

NOTE 17.   OPERATING SEGMENTS

Financial Information by Segment

Our operations are managed in two reportable segments reflecting our internal reporting structure and nature of services offered as follows:

Environmental Services - This segment provides a broad range of hazardous material management services including transportation, recycling, treatment and disposal of hazardous, non-hazardous and radioactive waste at Company-owned landfill, wastewater, deep-well injection and other treatment facilities.

Field & Industrial Services - This segment provides packaging and collection of hazardous waste and total waste management solutions at customer sites and through our 10-day transfer facilities. Services include on-site management, waste characterization, transportation and disposal of non-hazardous and hazardous waste. This segment also provides specialty field services such as industrial cleaning and maintenance, remediation, lab packs, retail services, transportation, emergency response and other services to commercial and industrial facilities and to government entities.

The operations not managed through our two reportable segments are recorded as “Corporate.” Corporate selling, general and administrative expenses include typical corporate items such as legal, accounting and other items of a general corporate nature. Income taxes are assigned to Corporate, but all other items are included in the segment where they originated. Inter-company transactions have been eliminated from the segment information and are not significant between segments.

Summarized financial information of our reportable segments is as follows:

	Three Months Ended June 30, 2019
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Corporate		Total
Revenue	$	112,844	$	42,958	$	—	$	155,802
Depreciation, amortization and accretion	$	10,377	$	2,151	$	597	$	13,125
Capital expenditures	$	14,455	$	2,059	$	920	$	17,434
Total assets	$	725,311	$	167,985	$	68,120	$	961,416

	Three Months Ended June 30, 2018
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Corporate		Total
Revenue	$	98,960	$	37,952	$	—	$	136,912
Depreciation, amortization and accretion	$	8,676	$	1,415	$	330	$	10,421
Capital expenditures	$	4,935	$	1,849	$	618	$	7,402
Total assets	$	599,706	$	126,797	$	98,160	$	824,663

	Six Months Ended June 30, 2019
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Corporate		Total
Revenue	$	205,177	$	81,662	$	—	$	286,839
Depreciation, amortization and accretion	$	20,003	$	4,282	$	901	$	25,186
Capital expenditures	$	21,296	$	2,108	$	1,253	$	24,657
Total assets	$	725,311	$	167,985	$	68,120	$	961,416

	Six Months Ended June 30, 2018
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Corporate		Total
Revenue	$	185,431	$	71,540	$	—	$	256,971
Depreciation, amortization and accretion	$	17,186	$	2,770	$	446	$	20,402
Capital expenditures	$	10,939	$	2,887	$	1,134	$	14,960
Total assets	$	599,706	$	126,797	$	98,160	$	824,663

Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”)

Management uses Adjusted EBITDA as a financial measure to assess segment performance. Adjusted EBITDA is defined as net income before interest expense, interest income, income tax expense, depreciation, amortization, share-based compensation, accretion of closure and post-closure liabilities, foreign currency gain/loss, non-cash property and equipment impairment charges, property insurance recoveries and other income/expense. Adjusted EBITDA is a complement to results provided in accordance with GAAP and we believe that such information provides additional useful information to analysts, stockholders and other users to understand the Company’s operating performance. Since Adjusted EBITDA is not a measurement determined in accordance with GAAP and is thus susceptible to varying calculations, Adjusted EBITDA as presented may not be comparable to other similarly titled measures of other companies. Items excluded from Adjusted EBITDA are significant components in understanding and assessing our financial performance. Adjusted EBITDA should not be considered in isolation or as an alternative to, or substitute for, net income, cash flows generated by operations, investing or financing activities, or other financial statement data presented in the consolidated financial statements as indicators of financial performance or liquidity. Adjusted EBITDA has limitations as an analytical tool and should not be considered in isolation or a substitute for analyzing our results as reported under GAAP. Some of the limitations are:

● Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;

● Adjusted EBITDA does not reflect our interest expense, or the requirements necessary to service interest or principal payments on our debt;

● Adjusted EBITDA does not reflect our income tax expenses or the cash requirements to pay our taxes;

● Adjusted EBITDA does not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments; and

● Although depreciation and amortization charges are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and Adjusted EBITDA does not reflect any cash requirements for such replacements.

A reconciliation of Net income to Adjusted EBITDA is as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
$s in thousands	2019		2018		2019		2018
Net income	$	15,491	$	13,220	$	23,534	$	22,463
Income tax expense		6,395		4,258		9,436		7,778
Interest expense		3,588		2,907		7,618		5,716
Interest income		(202)		(39)		(409)		(63)
Foreign currency loss		384		139		523		153
Other income		(122)		(193)		(232)		(2,316)
Property and equipment impairment charges		—		—		25		—
Depreciation and amortization of plant and equipment		9,129		7,044		17,254		13,649
Amortization of intangible assets		2,863		2,296		5,674		4,598
Share-based compensation		1,245		1,011		2,467		2,079
Accretion and non-cash adjustment of closure & post-closure liabilities		1,133		1,081		2,258		2,155
Property insurance recoveries		(4,500)		—		(9,153)		—
Adjusted EBITDA	$	35,404	$	31,724	$	58,995	$	56,212

Adjusted EBITDA, by operating segment, is as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
$s in thousands	2019		2018		2019		2018
Adjusted EBITDA:
Environmental Services	$	47,056	$	39,860	$	82,316	$	74,532
Field & Industrial Services		5,022		4,562		7,576		6,907
Corporate		(16,674)		(12,698)		(30,897)		(25,227)
Total	$	35,404	$	31,724	$	58,995	$	56,212

Property and Equipment and Intangible Assets Outside of the United States

We provide services in the United States and Canada. Long-lived assets, comprised of property and equipment and intangible assets net of accumulated depreciation and amortization, by geographic location are as follows:

	June 30,		December 31,
$s in thousands	2019		2018
United States	$	481,301	$	480,322
Canada		59,185		57,787
Total long-lived assets	$	540,486	$	538,109

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SUBSEQUENT EVENTS

6 Months Ended

Jun. 30, 2019

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS

NOTE 18.   SUBSEQUENT EVENTS

Quarterly Dividend

On July 1, 2019, we declared a quarterly dividend of $0.18 per common share to stockholders of record on July 19, 2019. The dividend was paid using cash on hand on July 26, 2019 in an aggregate amount of $4.0 million.

Acquisition of W.I.S.E. Environmental Solutions Inc.

On August 1, 2019, we acquired 100% of the outstanding shares of W.I.S.E. Environmental Services Inc. (“US Ecology Sarnia”), an environmental services company based in Sarnia, Ontario, Canada for 23.5 million Canadian dollars. The purchase price is subject to post-closing adjustments based on agreed upon working capital requirements. Revenues, net income, earnings per share and total assets of US Ecology Sarnia are not material to our consolidated financial position or results of operations.

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GENERAL (Policies)

6 Months Ended

Jun. 30, 2019

GENERAL

Basis of Presentation

Basis of Presentation

The accompanying unaudited consolidated financial statements include the results of operations, financial position and cash flows of US Ecology, Inc. and its wholly-owned subsidiaries. All inter-company balances have been eliminated. Throughout these financial statements words such as “we,” “us,” “our,” “US Ecology” and “the Company” refer to US Ecology, Inc. and its subsidiaries.

In the opinion of management, the accompanying unaudited consolidated financial statements include all adjustments (consisting only of normal recurring adjustments) necessary to present fairly, in all material respects, the results of the Company for the periods presented. These consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been omitted pursuant to the rules and regulations of the SEC. These consolidated financial statements should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018. The results of operations for the three and six months ended June 30, 2019 are not necessarily indicative of the results to be expected for the entire year ending December 31, 2019.

The Company’s consolidated balance sheet as of December 31, 2018 has been derived from the Company’s audited consolidated balance sheet as of that date.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ materially from the estimates and assumptions that we use in the preparation of our consolidated financial statements. As it relates to estimates and assumptions in amortization rates and environmental obligations, significant engineering, operations and accounting judgments are required. We review these estimates and assumptions no less than annually. In many circumstances, the ultimate outcome of these estimates and assumptions will not be known for decades into the future. Actual results could differ materially from these estimates and assumptions due to changes in applicable regulations, changes in future operational plans and inherent imprecision associated with estimating environmental impacts far into the future.

Recently Issued Accounting Pronouncements

Recently Issued Accounting Pronouncements

In August 2018, the SEC adopted the final rule under SEC Release No. 33-10532, “Disclosure Update and Simplification,” adopting amendments to certain disclosure rules that were redundant, duplicative, overlapping, outdated, or superseded, in light of other SEC disclosure requirements, GAAP or changes in the information environment. In addition, the amendments expanded the disclosure requirements relating to the analysis of equity for interim financial statements. Under the amendments, an analysis of the changes in each caption of shareholders’ equity and noncontrolling interests presented in the balance sheet must be provided in a note or separate statement. The analysis must present a reconciliation of the beginning balance to the ending balance of each period for which a statement of earnings is required to be filed. The final rule was effective on November 5, 2018. The Company adopted the final rule effective for the first quarter of 2019. The adoption of the final rule did not have an impact on the Company’s consolidated financial position or results of operations.

In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (Topic 815). This ASU amends the guidance in ASC 815 to better align an entity’s risk management activities and financial reporting for hedging relationships

through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The guidance is effective for annual and interim reporting periods beginning after December 15, 2018, with early adoption permitted. The Company adopted ASU 2017-12 on January 1, 2019 and the standard did not have a material impact on its consolidated financial statements.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The ASU significantly changes the accounting model used by lessees to account for leases, requiring that all material leases be presented on the balance sheet. Lessees will recognize substantially all leases on the balance sheet as a right-of-use asset and a corresponding lease liability. The Company adopted ASU 2016-02 on January 1, 2019 utilizing the modified retrospective transition method and elected not to recast comparative periods. We elected the package of practical expedients, which allows the Company not to reassess (1) whether any expired or existing contracts as of the adoption date are or contain a lease, (2) lease classification for any expired or existing leases as of the adoption date and (3) initial direct costs for any existing leases as of the adoption date.  We also elected the practical expedient related to land easements, allowing us to carry forward our accounting treatment for land easements on existing agreements. The Company did not elect to apply the hindsight practical expedient when determining lease term and assessing impairment of right-of-use assets.

Adoption of ASU 2016-02 resulted in the recognition of right-of-use assets and lease liabilities for operating leases of $18.1 million on its consolidated balance sheet as of March 31, 2019, with no material impact on its consolidated statement of stockholders’ equity or consolidated statements of operations. See Note 9 for additional information and disclosure on our leases.

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REVENUES (Tables)

6 Months Ended

Jun. 30, 2019

REVENUES

Schedule of disaggregation of revenues

	Three Months Ended June 30, 2019
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Total
Treatment & Disposal Revenue (1)	$	90,379	$	3,133	$	93,512
Services Revenue:
Transportation and Logistics (2)		22,465		12,760		35,225
Industrial Services (3)		—		4,963		4,963
Small Quantity Generation (4)		—		9,326		9,326
Total Waste Management (5)		—		8,004		8,004
Remediation (6)		—		889		889
Emergency Response (7)		—		3,180		3,180
Other (8)		—		703		703
Revenue	$	112,844	$	42,958	$	155,802

	Three Months Ended June 30, 2018
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Total
Treatment & Disposal Revenue (1)	$	78,093	$	2,902	$	80,995
Services Revenue:
Transportation and Logistics (2)		20,867		7,598		28,465
Industrial Services (3)		—		4,506		4,506
Small Quantity Generation (4)		—		9,138		9,138
Total Waste Management (5)		—		9,019		9,019
Remediation (6)		—		3,968		3,968
Emergency Response (7)		—		749		749
Other (8)		—		72		72
Revenue	$	98,960	$	37,952	$	136,912

	Six Months Ended June 30, 2019
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Total
Treatment & Disposal Revenue (1)	$	168,092	$	5,929	$	174,021
Services Revenue:
Transportation and Logistics (2)		37,085		19,852		56,937
Industrial Services (3)		—		10,980		10,980
Small Quantity Generation (4)		—		17,515		17,515
Total Waste Management (5)		—		16,719		16,719
Remediation (6)		—		2,616		2,616
Emergency Response (7)				6,226		6,226
Other (8)		—		1,825		1,825
Revenue	$	205,177	$	81,662	$	286,839

	Six Months Ended June 30, 2018
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Total
Treatment & Disposal Revenue (1)	$	150,802	$	5,549	$	156,351
Services Revenue:
Transportation and Logistics (2)		34,629		13,248		47,877
Industrial Services (3)		—		8,385		8,385
Small Quantity Generation (4)		—		17,465		17,465
Total Waste Management (5)		—		19,241		19,241
Remediation (6)		—		6,158		6,158
Emergency Response (7)				1,391		1,391
Other (8)		—		103		103
Revenue	$	185,431	$	71,540	$	256,971

(1) We categorize our treatment and disposal revenue as either “Base Business” or “Event Business” based on the underlying nature of the revenue source. We define Event Business as non-recurring projects that are expected to equal or exceed 1,000 tons, with Base Business defined as all other business not meeting the definition of Event Business. For the three months ended June 30, 2019 and 2018, 23% and 19%, respectively, of our treatment and disposal revenue was derived from Event Business projects. Base Business revenue accounted for 77% and 81% of our treatment and disposal revenue for the three months ended June 30, 2019 and 2018, respectively. For the six months ended June 30, 2019 and 2018, 19% and 18%, respectively, of our treatment and disposal revenue was derived from Event Business projects. Base Business revenue accounted for 81% and 82% of our treatment and disposal revenue for the six months ended June 30, 2019 and 2018, respectively.

(2) Includes collection and transportation of non-hazardous and hazardous waste.

(3) Includes industrial cleaning and maintenance for refineries, chemical plants, steel and automotive plants, marine terminals and refinery services such as tank cleaning and temporary storage.

(4) Includes retail services, laboratory packing, less-than-truck-load service and household hazardous waste collection. Contracts for Small Quantity Generation may extend beyond one year and a portion of the transaction price can be fixed.

(5) Through our TWM program, customers outsource the management of their waste compliance program to us, allowing us to organize and coordinate their waste management disposal activities and environmental compliance. TWM contracts may extend beyond one year and a portion of the transaction price can be fixed.

(6) Includes site assessment, onsite treatment, project management and remedial action planning and execution. Contracts for Remediation may extend beyond one year and a portion of the transaction price can be fixed.

(7) Includes spill response, waste analysis and treatment and disposal planning.

(8) Includes equipment rental and other miscellaneous services.

	Three Months Ended June 30, 2019						Three Months Ended June 30, 2018
			Field &						Field &
	Environmental		Industrial				Environmental		Industrial
$s in thousands	Services		Services		Total		Services		Services		Total
United States	$	85,785	$	42,958	$	128,743	$	84,917	$	37,952	$	122,869
Canada		27,059		—		27,059		14,043		—		14,043
Total revenue	$	112,844	$	42,958	$	155,802	$	98,960	$	37,952	$	136,912

	Six Months Ended June 30, 2019						Six Months Ended June 30, 2018
			Field &						Field &
	Environmental		Industrial				Environmental		Industrial
$s in thousands	Services		Services		Total		Services		Services		Total
United States	$	163,144	$	81,662	$	244,806	$	159,903	$	71,540	$	231,443
Canada		42,033		—		42,033		25,528		—		25,528
Total revenue	$	205,177	$	81,662	$	286,839	$	185,431	$	71,540	$	256,971

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BUSINESS COMBINATION (Tables)

6 Months Ended

Jun. 30, 2019

BUSINESS COMBINATION

Summary of preliminary fair value estimates of assets acquired and liabilities assumed

	Purchase Price Allocation
	December 31,				June 30,
$s in thousands	2018		Adjustments		2019
Current assets	$	1,923	$	(63)	$	1,860
Property and equipment		6,300		(2,324)		3,976
Identifiable intangible assets		66,600		(100)		66,500
Current liabilities		(755)		—		(755)
Other liabilities		(512)		—		(512)
Total identifiable net assets		73,556		(2,487)		71,069
Goodwill		13,573		2,586		16,159
Total purchase price	$	87,129	$	99	$	87,228

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables)

6 Months Ended

Jun. 30, 2019

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS).

Schedule of changes in accumulated other comprehensive income (loss)

	Foreign		Unrealized Gain
	Currency		(Loss) on Interest
$s in thousands	Translation		Rate Hedge		Total
Balance at December 31, 2018	$	(14,697)	$	906	$	(13,791)
Other comprehensive income (loss) before reclassifications, net of tax		3,369		(1,658)		1,711
Amounts reclassified out of AOCI, net of tax (1)		—		(210)		(210)
Other comprehensive income, net		3,369		(1,868)		1,501
Balance at June 30, 2019	$	(11,328)	$	(962)	$	(12,290)

(1) Before-tax reclassifications of $127,000 ($100,000 after-tax) and $266,000 ($210,000 after-tax) for the three and six months ended June 30, 2019, were included as a reduction of Interest expense in the Company’s consolidated statements of operations. Amounts relate to the Company’s interest rate swap which is designated as a cash flow hedge. Changes in fair value of the swap recognized in AOCI are reclassified to interest expense when hedged interest payments on the underlying long-term debt are made. Amounts in AOCI expected to be recognized as a reduction of interest expense over the next 12 months total approximately $509,000 ($402,000 after-tax).

	Foreign		Unrealized Gain
	Currency		(Loss) on Interest
$s in thousands	Translation		Rate Hedge		Total
Balance at December 31, 2017	$	(8,603)	$	(501)	$	(9,104)
Other comprehensive income (loss) before reclassifications, net of tax		(3,468)		1,913		(1,555)
Amounts reclassified out of AOCI, net of tax (2)		—		310		310
Other comprehensive income, net		(3,468)		2,223		(1,245)
Balance at June 30, 2018	$	(12,071)	$	1,722	$	(10,349)

(2) Before-tax reclassifications of $119,000 ($94,000 after-tax) and $392,000 ($310,000 after-tax) for the three and six months ended June 30, 2018, were included in Interest expense in the Company’s consolidated statements of operations. Amounts relate to the Company’s interest rate swap which is designated as a cash flow hedge. Changes in fair value of the swap recognized in AOCI are reclassified to interest expense when hedged interest payments on the underlying long-term debt are made.

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RECEIVABLES (Tables)

6 Months Ended

Jun. 30, 2019

RECEIVABLES

Schedule of receivables

	June 30,		December 31,
$s in thousands	2019		2018
Trade	$	115,935	$	118,909
Unbilled revenue		27,741		26,538
Other		8,887		2,241
Total receivables		152,563		147,688
Allowance for doubtful accounts		(2,526)		(2,998)
Receivables, net	$	150,037	$	144,690

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FAIR VALUE MEASUREMENTS (Tables)

6 Months Ended

Jun. 30, 2019

FAIR VALUE MEASUREMENTS

Schedule of assets and liabilities measured at fair value on a recurring basis

	June 30, 2019
	Quoted Prices in		Other Observable		Unobservable
	Active Markets		Inputs		Inputs
$s in thousands	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Fixed-income securities (1)	$	1,979	$	2,224	$	—	$	4,203
Money market funds (2)		818		—		—		818
Total	$	2,797	$	2,224	$	—	$	5,021
Liabilities:
Interest rate swap agreement (3)	$	—	$	1,217	$	—	$	1,217
Total	$	—	$	1,217	$	—	$	1,217

	December 31, 2018
	Quoted Prices in		Other Observable		Unobservable
	Active Markets		Inputs		Inputs
$s in thousands	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Fixed-income securities (1)	$	1,561	$	2,596	$	—	$	4,157
Money market funds (2)		784		—		—		784
Interest rate swap agreement (3)		—		1,147				1,147
Total	$	2,345	$	3,743	$	—	$	6,088

(1) We invest a portion of our Restricted cash and investments in fixed-income securities, including U.S. Treasury and U.S. agency securities. We measure the fair value of U.S. Treasury securities using quoted prices for identical assets in active markets. We measure the fair value of U.S. agency securities using observable market activity for similar assets. The fair value of our fixed-income securities approximates our cost basis in the investments.

(2) We invest a portion of our Restricted cash and investments in money market funds. We measure the fair value of these money market fund investments using quoted prices for identical assets in active markets. Money market funds are considered restricted cash for purposes of reconciling the beginning-of-period and end-of-period amounts presented in the Company’s consolidated statements of cash flows.

(3) In order to manage interest rate exposure, we entered into an interest rate swap agreement in October 2014 that effectively converts a portion of our variable-rate debt to a fixed interest rate. The swap is designated as a cash flow hedge, with gains and losses deferred in other comprehensive income to be recognized as an adjustment to interest expense in the same period that the hedged interest payments affect earnings. The interest rate swap has an effective date of December 31, 2014 with an initial notional amount of $250.0 million. The fair value of the interest rate swap agreement represents the difference in the present value of cash flows calculated at the contracted interest rates and at current market interest rates at the end of the period. We calculate the fair value of the interest rate swap agreement quarterly based on the quoted market price for the same or similar financial instruments. The fair value of the interest rate swap agreement is included in Other long-term liabilities and Other assets in the Company’s consolidated balance sheet as of June 30, 2019 and December 31, 2018, respectively.

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PROPERTY AND EQUIPMENT (Tables)

6 Months Ended

Jun. 30, 2019

PROPERTY AND EQUIPMENT

Schedule of property and equipment

	June 30,		December 31,
$s in thousands	2019		2018
Cell development costs	$	147,059	$	146,155
Land and improvements		53,067		50,481
Buildings and improvements		91,743		91,358
Railcars		17,299		17,299
Vehicles and other equipment		162,388		154,014
Construction in progress		26,546		14,554
Total property and equipment		498,102		473,861
Accumulated depreciation and amortization		(232,482)		(215,418)
Property and equipment, net	$	265,620	$	258,443

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LEASES (Tables)

6 Months Ended

Jun. 30, 2019

LEASES

Summary of leased assets and liabilities

$s in thousands	June 30, 2019
Assets:
Operating right-of-use assets (1)	$	17,575
Finance right-of-use assets (2)		3,028
Total	$	20,603
Liabilities:
Current:
Operating (3)	$	4,932
Finance (4)		837
Long-term:
Operating (5)		12,553
Finance (6)		2,269
Total	$	20,591

(1) Included in Operating lease assets in the Company’s consolidated balance sheets.

(2) Included in Property and equipment, net in the Company’s consolidated balance sheets. Finance right-of-use assets are recorded net of accumulated amortization of $1.5 million as of June 30, 2019.

(3) Included in Current portion of operating lease liabilities in the Company’s consolidated balance sheets.

(4) Included in Accrued liabilities in the Company’s consolidated balance sheets.

(5) Included in Long-term operating lease liabilities in the Company’s consolidated balance sheets.

(6) Included in Other long-term liabilities in the Company’s consolidated balance sheets.

Summary of lease cost

	Three Months Ended		Six Months Ended
$s in thousands	June 30, 2019		June 30, 2019
Operating lease cost (1)	$	1,713	$	3,455
Finance lease cost:
Amortization of leased assets (2)		248		476
Interest on lease liabilities (3)		30		50
Total	$	1,991	$	3,981

(1) Included in Direct operating costs and Selling, general, and administrative expenses in the Company’s consolidated statements of operations. Operating lease cost includes short-term leases, excluding expenses relating to leases with a term of one month or less, which are not material. Operating lease cost excludes variable lease costs which are not material.

(2) Included in Direct operating costs in the Company’s consolidated statements of operations.

(3) Included in Interest expense in the Company’s consolidated statements of operations.

Schedule of cash flow supplemental information

	Six Months Ended
$s in thousands	June 30, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	3,238
Operating cash flows from finance leases		50
Financing cash flows from finance leases		408
Non-cash investing and financing activities:
Right-of-use assets obtained in exchange for new operating lease liabilities	$	2,397
Right-of-use assets obtained in exchange for new finance lease liabilities		1,844

Summary of weighted-average remaining lease term and discount rate

	June 30, 2019
Weighted-average remaining lease term (years):
Operating leases		5.6
Finance leases		3.7
Weighted-average discount rate:
Operating leases		4.38	%
Finance leases		3.71	%

Summary of future maturity of lease liability and its present value

	Operating		Finance
$s in thousands	Leases		Leases		Total
2019 (excluding the six months ended June 30, 2019)	$	2,936	$	484	$	3,420
2020		4,110		792		4,902
2021		3,663		619		4,282
2022		2,367		548		2,915
2023		1,886		612		2,498
Thereafter		5,157		354		5,511
Total	$	20,119	$	3,409	$	23,528
Less: Interest		2,634		303		2,937
Present value of lease liabilities	$	17,485	$	3,106	$	20,591

$s in thousands	Payments
2019	$	5,638
2020		3,644
2021		3,184
2022		1,885
2023		1,457
Thereafter		5,065
	$	20,873

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GOODWILL AND INTANGIBLE ASSETS (Tables)

6 Months Ended

Jun. 30, 2019

GOODWILL AND INTANGIBLE ASSETS

Schedule of changes in goodwill

					Field &
	Environmental				Industrial
	Services				Services
			Accumulated				Accumulated
$s in thousands	Gross		Impairment		Gross		Impairment		Total
Balance at December 31, 2018	$	162,816	$	(6,870)	$	51,231	$	—	$	207,177
Winnie purchase price allocation adjustment		2,586		—		—		—		2,586
Foreign currency translation		703		—		—		—		703
Balance at June 30, 2019	$	166,105	$	(6,870)	$	51,231	$	—	$	210,466

Schedule of intangible assets, net

	June 30, 2019						December 31, 2018
			Accumulated						Accumulated
$s in thousands	Cost		Amortization		Net		Cost		Amortization		Net
Amortizing intangible assets:
Permits, licenses and lease	$	165,600	$	(16,817)	$	148,783	$	164,840	$	(14,804)	$	150,036
Customer relationships		99,396		(28,948)		70,448		99,241		(25,676)		73,565
Technology - formulae and processes		6,951		(1,897)		5,054		6,672		(1,714)		4,958
Customer backlog		3,652		(1,839)		1,813		3,652		(1,656)		1,996
Developed software		2,894		(1,737)		1,157		2,884		(1,581)		1,303
Non-compete agreements		1,542		(1,076)		466		1,542		(875)		667
Internet domain and website		536		(142)		394		536		(128)		408
Database		387		(181)		206		384		(167)		217
Total amortizing intangible assets		280,958		(52,637)		228,321		279,751		(46,601)		233,150
Non-amortizing intangible assets:
Permits and licenses		46,415		—		46,415		46,391		—		46,391
Tradename		130		—		130		125		—		125
Total intangible assets	$	327,503	$	(52,637)	$	274,866	$	326,267	$	(46,601)	$	279,666

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DEBT (Tables)

6 Months Ended

Jun. 30, 2019

DEBT

Schedule of long-term debt

	June 30,		December 31,
$s in thousands	2019		2018
Revolving credit facility	$	334,000	$	364,000
Long-term debt	$	334,000	$	364,000

Schedule of interest margins based on the total net leverage ratio

Total Net Leverage Ratio	LIBOR Rate Loans Interest Margin	Base Rate Loans Interest Margin
Equal to or greater than 3.25 to 1.00	2.00%	1.00%
Equal to or greater than 2.50 to 1.00, but less than 3.25 to 1.00	1.75%	0.75%
Equal to or greater than 1.75 to 1.00, but less than 2.50 to 1.00	1.50%	0.50%
Equal to or greater than 1.00 to 1.00, but less than 1.75 to 1.00	1.25%	0.25%
Less than 1.00 to 1.00	1.00%	0.00%

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CLOSURE AND POST-CLOSURE OBLIGATIONS (Tables)

6 Months Ended

Jun. 30, 2019

CLOSURE AND POST-CLOSURE OBLIGATIONS

Schedule of changes to reported closure and post closure obligations

	Three Months Ended		Six Months Ended
$s in thousands	June 30, 2019		June 30, 2019
Closure and post-closure obligations, beginning of period	$	79,056	$	78,363
Accretion expense		1,133		2,258
Payments		(305)		(775)
Foreign currency translation		35		73
Closure and post-closure obligations, end of period		79,919		79,919
Less current portion		(2,231)		(2,231)
Long-term portion	$	77,688	$	77,688

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EARNINGS PER SHARE (Tables)

6 Months Ended

Jun. 30, 2019

EARNINGS PER SHARE

Schedule of earnings per share

	Three Months Ended June 30,
	2019				2018
$s and shares in thousands, except per share amounts	Basic		Diluted		Basic		Diluted
Net income	$	15,491	$	15,491	$	13,220	$	13,220
Weighted average basic shares outstanding		22,006		22,006		21,867		21,867
Dilutive effect of share-based awards				202				157
Weighted average diluted shares outstanding				22,208				22,024
Earnings per share	$	0.70	$	0.70	$	0.60	$	0.60
Anti-dilutive shares excluded from calculation				92				58

	Six Months Ended June 30,
	2019				2018
$s and shares in thousands, except per share amounts	Basic		Diluted		Basic		Diluted
Net income	$	23,534	$	23,534	$	22,463	$	22,463
Weighted average basic shares outstanding		21,997		21,997		21,835		21,835
Dilutive effect of share-based awards				206				156
Weighted average diluted shares outstanding				22,203				21,991
Earnings per share	$	1.07	$	1.06	$	1.03	$	1.02
Anti-dilutive shares excluded from calculation				86				76

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EQUITY (Tables)

6 Months Ended

Jun. 30, 2019

EQUITY

Schedule of assumptions for determining the fair value for PSU awards using Monte Carlo simulation models

	2019
Stock price on grant date	$	58.40
Expected term		3.0	years
Expected volatility		30	%
Risk-free interest rate		2.5	%
Expected dividend yield		1.1	%

Summary of PSU, restricted stock and RSU activity

	PSUs			Restricted Stock			RSUs
		Weighted			Weighted			Weighted
		Average			Average			Average
		Grant Date			Grant Date			Grant Date
	Shares	Fair Value		Shares	Fair Value		Shares	Fair Value
Outstanding as of December 31, 2018	39,200	$	55.48	74,988	$	46.74	66,785	$	53.77
Granted	17,111		58.20	27,800		62.59	33,020		56.21
Vested	(13,600)		41.22	(39,234)		43.77	(26,362)		48.28
Cancelled, expired or forfeited	—		—	—		—	(243)		45.66
Outstanding as of June 30, 2019	42,711	$	61.11	63,554	$	55.50	73,200	$	56.88

Summary of stock option activity

		Weighted
		Average
		Exercise
	Shares	Price
Outstanding as of December 31, 2018	236,503	$	44.93
Granted	41,100		63.36
Exercised	(3,246)		42.29
Cancelled, expired or forfeited	(1,540)		43.55
Outstanding as of June 30, 2019	272,817	$	47.74
Exercisable as of June 30, 2019	191,756	$	43.83

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OPERATING SEGMENTS (Tables)

6 Months Ended

Jun. 30, 2019

OPERATING SEGMENTS

Summary of financial information of our reportable segments

	Three Months Ended June 30, 2019
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Corporate		Total
Revenue	$	112,844	$	42,958	$	—	$	155,802
Depreciation, amortization and accretion	$	10,377	$	2,151	$	597	$	13,125
Capital expenditures	$	14,455	$	2,059	$	920	$	17,434
Total assets	$	725,311	$	167,985	$	68,120	$	961,416

	Three Months Ended June 30, 2018
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Corporate		Total
Revenue	$	98,960	$	37,952	$	—	$	136,912
Depreciation, amortization and accretion	$	8,676	$	1,415	$	330	$	10,421
Capital expenditures	$	4,935	$	1,849	$	618	$	7,402
Total assets	$	599,706	$	126,797	$	98,160	$	824,663

	Six Months Ended June 30, 2019
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Corporate		Total
Revenue	$	205,177	$	81,662	$	—	$	286,839
Depreciation, amortization and accretion	$	20,003	$	4,282	$	901	$	25,186
Capital expenditures	$	21,296	$	2,108	$	1,253	$	24,657
Total assets	$	725,311	$	167,985	$	68,120	$	961,416

	Six Months Ended June 30, 2018
			Field &
	Environmental		Industrial
$s in thousands	Services		Services		Corporate		Total
Revenue	$	185,431	$	71,540	$	—	$	256,971
Depreciation, amortization and accretion	$	17,186	$	2,770	$	446	$	20,402
Capital expenditures	$	10,939	$	2,887	$	1,134	$	14,960
Total assets	$	599,706	$	126,797	$	98,160	$	824,663

Reconciliation of Net Income to Adjusted EBITDA and adjusted EBITDA by operating segment

	Three Months Ended June 30,				Six Months Ended June 30,
$s in thousands	2019		2018		2019		2018
Net income	$	15,491	$	13,220	$	23,534	$	22,463
Income tax expense		6,395		4,258		9,436		7,778
Interest expense		3,588		2,907		7,618		5,716
Interest income		(202)		(39)		(409)		(63)
Foreign currency loss		384		139		523		153
Other income		(122)		(193)		(232)		(2,316)
Property and equipment impairment charges		—		—		25		—
Depreciation and amortization of plant and equipment		9,129		7,044		17,254		13,649
Amortization of intangible assets		2,863		2,296		5,674		4,598
Share-based compensation		1,245		1,011		2,467		2,079
Accretion and non-cash adjustment of closure & post-closure liabilities		1,133		1,081		2,258		2,155
Property insurance recoveries		(4,500)		—		(9,153)		—
Adjusted EBITDA	$	35,404	$	31,724	$	58,995	$	56,212

Adjusted EBITDA, by operating segment, is as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
$s in thousands	2019		2018		2019		2018
Adjusted EBITDA:
Environmental Services	$	47,056	$	39,860	$	82,316	$	74,532
Field & Industrial Services		5,022		4,562		7,576		6,907
Corporate		(16,674)		(12,698)		(30,897)		(25,227)
Total	$	35,404	$	31,724	$	58,995	$	56,212

Schedule of long-lived assets by geographic location

	June 30,		December 31,
$s in thousands	2019		2018
United States	$	481,301	$	480,322
Canada		59,185		57,787
Total long-lived assets	$	540,486	$	538,109

XML

GENERAL (Details) - USD ($) $ in Thousands	Jan. 01, 2019	Jun. 30, 2019	Mar. 31, 2019
Recently issued accounting pronouncements
Operating lease, right-of-use asset		$ 17,575
Operating lease liability		$ 17,485
ASU 2016-02
Recently issued accounting pronouncements
Practical expedients - Package	true
Practical expedients - Land easements	true
Practical expedients - Hindsight	false
Operating lease, right-of-use asset			$ 18,100
Operating lease liability			$ 18,100

XML

GENERAL - NRCG Merger (Details)	Jun. 23, 2019 USD ($) item $ / shares shares	Jun. 30, 2019 $ / shares	Dec. 31, 2018 $ / shares
Acquisition
Common stock, par value (in dollars per share)		$ 0.01	$ 0.01
HoldCo
Acquisition
Common stock, par value (in dollars per share)	$ 0.01
HoldCo | US Ecology
Acquisition
Common stock, par value (in dollars per share)	$ 0.01
Number of shares of stock to be received of Holdco for each share of stock held | shares	1
Number of equity awards exchanged | item	1
HoldCo | US Ecology | Treasury Stock
Acquisition
Acquisition price | $	$ 0
HoldCo | NRCG
Acquisition
Common stock, par value (in dollars per share)	$ 0.0001
Number of shares of stock to be received of Holdco for each share of stock held | shares	0.196
HoldCo | NRCG | Replacement warrants
Acquisition
Pre-Merger exercise price	$ 11.50
HoldCo | NRCG | 7.00% Series A Convertible Cumulative Preferred Stock
Acquisition
Preferred stock, par value (in dollars per share)	$ 0.0001
HoldCo | NRCG | Treasury Stock
Acquisition
Acquisition price | $	$ 0

XML

REVENUES (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019 USD ($)	Jun. 30, 2018 USD ($)	Jun. 30, 2019 USD ($) segment	Jun. 30, 2018 USD ($)	Dec. 31, 2018 item
Disaggregation of revenue
Number of reportable segments | segment			2
Revenue	$ 155,802	$ 136,912	$ 286,839	$ 256,971
Field and Industrial Services
Disaggregation of revenue
Number of service lines | item					2
Treatment and disposal
Disaggregation of revenue
Revenue	93,512	80,995	174,021	156,351
Transportation and Logistics
Disaggregation of revenue
Revenue	35,225	28,465	56,937	47,877
Industrial Services
Disaggregation of revenue
Revenue	4,963	4,506	10,980	8,385
Small Quantity Generation
Disaggregation of revenue
Revenue	9,326	9,138	17,515	17,465
Total Waste Management
Disaggregation of revenue
Revenue	8,004	9,019	16,719	19,241
Remediation
Disaggregation of revenue
Revenue	889	3,968	2,616	6,158
Emergency Response
Disaggregation of revenue
Revenue	3,180	749	6,226	1,391
Other
Disaggregation of revenue
Revenue	703	72	1,825	103
Operating Segment | Environmental Services
Disaggregation of revenue
Revenue	112,844	98,960	205,177	185,431
Operating Segment | Field and Industrial Services
Disaggregation of revenue
Revenue	42,958	37,952	81,662	71,540
Operating Segment | Treatment and disposal | Environmental Services
Disaggregation of revenue
Revenue	90,379	78,093	168,092	150,802
Operating Segment | Treatment and disposal | Field and Industrial Services
Disaggregation of revenue
Revenue	3,133	2,902	5,929	5,549
Operating Segment | Transportation and Logistics | Environmental Services
Disaggregation of revenue
Revenue	22,465	20,867	37,085	34,629
Operating Segment | Transportation and Logistics | Field and Industrial Services
Disaggregation of revenue
Revenue	12,760	7,598	19,852	13,248
Operating Segment | Industrial Services | Field and Industrial Services
Disaggregation of revenue
Revenue	4,963	4,506	10,980	8,385
Operating Segment | Small Quantity Generation | Field and Industrial Services
Disaggregation of revenue
Revenue	9,326	9,138	17,515	17,465
Operating Segment | Total Waste Management | Field and Industrial Services
Disaggregation of revenue
Revenue	8,004	9,019	16,719	19,241
Operating Segment | Remediation | Field and Industrial Services
Disaggregation of revenue
Revenue	889	3,968	2,616	6,158
Operating Segment | Emergency Response | Field and Industrial Services
Disaggregation of revenue
Revenue	3,180	749	6,226	1,391
Operating Segment | Other | Field and Industrial Services
Disaggregation of revenue
Revenue	$ 703	$ 72	$ 1,825	$ 103

XML

REVENUES - Treatment and Disposal Revenue (Details) - Treatment and disposal - T	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Event Business
Disaggregation of revenue
Threshold Tons of Non-recurring projects			1,000
Revenue (in percent)	23.00%	19.00%	19.00%	18.00%
Base Business
Disaggregation of revenue
Revenue (in percent)	77.00%	81.00%	81.00%	82.00%

XML

REVENUES - Geography (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Disaggregation of revenue
Revenue	$ 155,802	$ 136,912	$ 286,839	$ 256,971
United States
Disaggregation of revenue
Revenue	128,743	122,869	244,806	231,443
Canada
Disaggregation of revenue
Revenue	27,059	14,043	42,033	25,528
Operating Segment | Environmental Services
Disaggregation of revenue
Revenue	112,844	98,960	205,177	185,431
Operating Segment | Environmental Services | United States
Disaggregation of revenue
Revenue	85,785	84,917	163,144	159,903
Operating Segment | Environmental Services | Canada
Disaggregation of revenue
Revenue	27,059	14,043	42,033	25,528
Operating Segment | Field and Industrial Services
Disaggregation of revenue
Revenue	42,958	37,952	81,662	71,540
Operating Segment | Field and Industrial Services | United States
Disaggregation of revenue
Revenue	$ 42,958	$ 37,952	$ 81,662	$ 71,540

XML

REVENUES - Practical Expedients (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
REVENUES
Deferred revenue recognized in revenue	$ 1.5	$ 1.5	$ 9.0	$ 7.8
Revenue, Practical Expedient, Financing Component			true
Revenue, Practical Expedient, Initial Application and Transition, Nonrestatement of Modified Contract			true

XML

BUSINESS COMBINATION (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2019	Dec. 31, 2018
Consideration paid and the fair value of assets acquired and liabilities assumed
Goodwill	$ 210,466	$ 207,177
Field and Industrial Services
Consideration paid and the fair value of assets acquired and liabilities assumed
Goodwill	51,231	51,231
Winnie
Consideration paid and the fair value of assets acquired and liabilities assumed
Current assets	1,860	1,923
Property and equipment	3,976	6,300
Identifiable intangible assets	66,500	66,600
Current liabilities	(755)	(755)
Other liabilities	(512)	(512)
Total identifiable net assets	71,069	73,556
Goodwill	16,159	13,573
Total purchase price	87,228	$ 87,129
Adjustments
Current assets - adjustment	(63)
Property and equipment - adjustment	(2,324)
Identifiable intangible assets - adjustment	(100)
Total identifiable net assets - adjustment	(2,487)
Goodwill - adjustment	2,586
Total purchase price - adjustment	$ 99

XML

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) - Changes in AOCI (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Accumulated other comprehensive income (loss)
Beginning balances	$ 363,492	$ 330,147	$ 359,217	$ 324,077
Ending balances	376,759	340,300	376,759	340,300
Foreign Currency Translation
Accumulated other comprehensive income (loss)
Beginning balances			(14,697)	(8,603)
Other comprehensive income (loss) before reclassifications, net of tax			3,369	(3,468)
Other comprehensive income, net			3,369	(3,468)
Ending balances	(11,328)	(12,071)	(11,328)	(12,071)
Unrealized Gain (Loss) on Interest Rate Hedge
Accumulated other comprehensive income (loss)
Beginning balances			906	(501)
Other comprehensive income (loss) before reclassifications, net of tax			(1,658)	1,913
Amounts reclassified out of AOCI, net of tax			(210)	310
Other comprehensive income, net			(1,868)	2,223
Ending balances	(962)	1,722	(962)	1,722
Accumulated Other Comprehensive Income (Loss)
Accumulated other comprehensive income (loss)
Beginning balances	(12,793)	(9,380)	(13,791)	(9,104)
Other comprehensive income (loss) before reclassifications, net of tax			1,711	(1,555)
Amounts reclassified out of AOCI, net of tax			(210)	310
Other comprehensive income, net	503	(969)	1,501	(1,245)
Ending balances	$ (12,290)	$ (10,349)	$ (12,290)	$ (10,349)

XML

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) -Reclassifications Line Items (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Reclassification adjustments
Interest expense	$ 3,588,000	$ 2,907,000	$ 7,618,000	$ 5,716,000
Unrealized Gain (Loss) on Interest Rate Hedge | Interest rate swap agreement
Reclassification adjustments
Amounts in AOCI expected to be recognized over the next 12 months before tax	509,000		509,000
Amounts in AOCI expected to be recognized over the next 12 months, net of taxes	402,000		402,000
Unrealized Gain (Loss) on Interest Rate Hedge | Interest rate swap agreement | Reclassification out of accumulated other comprehensive income
Reclassification adjustments
Interest expense	127,000	119,000	266,000	392,000
Interest expense, net of tax	$ 100,000	$ 94,000	$ 210,000	$ 310,000

XML

RECEIVABLES (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
RECEIVABLES
Trade	$ 115,935	$ 118,909
Unbilled revenue	27,741	26,538
Other	8,887	2,241
Total receivables	152,563	147,688
Allowance for doubtful accounts	(2,526)	(2,998)
Receivables, net	$ 150,037	$ 144,690

XML

FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018	Dec. 31, 2014
Interest rate swap agreement
Assets measured at fair value on a recurring basis
Initial notional amount			$ 250,000
Recurring
Assets measured at fair value on a recurring basis
Assets fair value disclosure	$ 5,021	$ 6,088
Liabilities fair value disclosure	1,217
Recurring | Interest rate swap agreement
Assets measured at fair value on a recurring basis
Assets fair value disclosure		1,147
Liabilities fair value disclosure	1,217
Recurring | Fixed-income securities
Assets measured at fair value on a recurring basis
Assets fair value disclosure	4,203	4,157
Recurring | Money market funds
Assets measured at fair value on a recurring basis
Assets fair value disclosure	818	784
Recurring | Quoted Prices in Active Markets (Level 1)
Assets measured at fair value on a recurring basis
Assets fair value disclosure	2,797	2,345
Recurring | Quoted Prices in Active Markets (Level 1) | Fixed-income securities
Assets measured at fair value on a recurring basis
Assets fair value disclosure	1,979	1,561
Recurring | Quoted Prices in Active Markets (Level 1) | Money market funds
Assets measured at fair value on a recurring basis
Assets fair value disclosure	818	784
Recurring | Other Observable Inputs (Level 2)
Assets measured at fair value on a recurring basis
Assets fair value disclosure	2,224	3,743
Liabilities fair value disclosure	1,217
Recurring | Other Observable Inputs (Level 2) | Interest rate swap agreement
Assets measured at fair value on a recurring basis
Assets fair value disclosure		1,147
Liabilities fair value disclosure	1,217
Recurring | Other Observable Inputs (Level 2) | Fixed-income securities
Assets measured at fair value on a recurring basis
Assets fair value disclosure	$ 2,224	$ 2,596

XML

PROPERTY AND EQUIPMENT (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2018
PROPERTY AND EQUIPMENT
Total property and equipment	$ 498,102		$ 498,102		$ 473,861
Accumulated depreciation and amortization	(232,482)		(232,482)		(215,418)
Property and equipment, net	265,620		265,620		258,443
Depreciation and amortization of plant and equipment	9,129	$ 7,044	17,254	$ 13,649
Cell development costs
PROPERTY AND EQUIPMENT
Total property and equipment	147,059		147,059		146,155
Land and improvements
PROPERTY AND EQUIPMENT
Total property and equipment	53,067		53,067		50,481
Buildings and improvements
PROPERTY AND EQUIPMENT
Total property and equipment	91,743		91,743		91,358
Railcars
PROPERTY AND EQUIPMENT
Total property and equipment	17,299		17,299		17,299
Vehicles and other equipment
PROPERTY AND EQUIPMENT
Total property and equipment	162,388		162,388		154,014
Construction in progress
PROPERTY AND EQUIPMENT
Total property and equipment	$ 26,546		$ 26,546		$ 14,554

XML

LEASES (Details)	6 Months Ended
	Jun. 30, 2019
Leases
Operating lease - existence of option to renew	true
Finance lease - existence of option to renew	true
Minimum
Leases
Operating lease - term	1 year
Finance lease - term	1 year
Maximum
Leases
Operating lease - term	15 years
Operating lease - renewal term	40 years
Finance lease - term	15 years
Finance lease - renewal term	40 years

XML

LEASES - Leased assets and liabilities (Details) $ in Thousands	Jun. 30, 2019 USD ($)
Assets:
Operating lease assets	$ 17,575
Finance right-of-use lease assets	3,028
Total	20,603
Finance leased assets - accumulated amortization	1,500
Liabilities:
Operating lease, current	4,932
Finance lease, current	837
Long-term operating lease liabilities	12,553
Finance lease, long term	2,269
Total	$ 20,591

XML

LEASES - Lease cost (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2019
Lease cost
Operating lease cost	$ 1,713	$ 3,455
Amortization of leased assets	248	476
Interest on lease liabilities	30	50
Total	$ 1,991	$ 3,981

XML

LEASES - Supplemental Cash Flow information (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2019 USD ($)
LEASES
Operating cash flows from operating leases	$ 3,238
Operating cash flows from finance leases	50
Financing cash flows from finance leases	408
Right-of-use assets obtained in exchange for new operating lease liabilities	2,397
Right-of-use assets obtained in exchange for new finance lease liabilities	$ 1,844

XML

LEASES - Weighted-average remaining lease term and discount rate (Details)	Jun. 30, 2019
LEASES
Weighted-average remaining lease term, operating leases	5 years 7 months 6 days
Weighted-average remaining lease term, finance leases	3 years 8 months 12 days
Weighted-average discount rate, operating leases	4.38%
Weighted-average discount rate, finance leases	3.71%

XML

LEASES - Future maturity of lease liability and its present value (Details) $ in Thousands	Jun. 30, 2019 USD ($)
Operating Leases
2019 (excluding the six months ended June 30, 2019)	$ 2,936
2020	4,110
2021	3,663
2022	2,367
2023	1,886
Thereafter	5,157
Total	20,119
Less: Interest	2,634
Present Value of Lease Liabilities	17,485
Finance Leases
2019 (excluding the six months ended June 30, 2019)	484
2020	792
2021	619
2022	548
2023	612
Thereafter	354
Total	3,409
Less: Interest	303
Present Value of Lease Liabilities	3,106
Operating And Finance Leases
2019 (excluding the six months ended June 30, 2019)	3,420
2020	4,902
2021	4,282
2022	2,915
2023	2,498
Thereafter	5,511
Total	23,528
Less: Interest	2,937
Present Value of Lease Liabilities	$ 20,591

XML

LEASES - Operating Leases (Details) $ in Thousands	Dec. 31, 2018 USD ($)
Future minimum lease payments on non-cancellable operating leases
2019	$ 5,638
2020	3,644
2021	3,184
2022	1,885
2023	1,457
Thereafter	5,065
Total	$ 20,873

XML

GOODWILL AND INTANGIBLE ASSETS - Goodwill (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2019 USD ($)
Changes in goodwill
Balance at the beginning of the period	$ 207,177
Foreign currency translation	703
Balance at the end of the period	210,466
Winnie
Changes in goodwill
Balance at the beginning of the period	13,573
Purchase price allocation adjustment	2,586
Balance at the end of the period	16,159
Environmental Services
Changes in goodwill
Balance at the beginning of the period	162,816
Foreign currency translation	703
Balance at the end of the period	166,105
Accumulated Impairment
Accumulated impairment at the beginning	(6,870)
Accumulated impairment at the ending	(6,870)
Environmental Services | Winnie
Changes in goodwill
Purchase price allocation adjustment	2,586
Field and Industrial Services
Changes in goodwill
Balance at the beginning of the period	51,231
Balance at the end of the period	$ 51,231

XML

GOODWILL AND INTANGIBLE ASSETS - Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2018
Intangible Assets
Amortizing intangible assets, Cost	$ 280,958		$ 280,958		$ 279,751
Accumulated amortization	(52,637)		(52,637)		(46,601)
Amortizing intangible assets, Net	228,321		228,321		233,150
Total intangible assets, cost	327,503		327,503		326,267
Total intangible assets, net	274,866		274,866		279,666
Amortization of intangible assets	2,863	$ 2,296	5,674	$ 4,598
Permits and licenses
Intangible Assets
Non-amortizing intangible assets	46,415		46,415		46,391
Tradename
Intangible Assets
Non-amortizing intangible assets	130		130		125
Permits, licenses and lease
Intangible Assets
Amortizing intangible assets, Cost	165,600		165,600		164,840
Accumulated amortization	(16,817)		(16,817)		(14,804)
Amortizing intangible assets, Net	148,783		148,783		150,036
Customer relationships
Intangible Assets
Amortizing intangible assets, Cost	99,396		99,396		99,241
Accumulated amortization	(28,948)		(28,948)		(25,676)
Amortizing intangible assets, Net	70,448		70,448		73,565
Technology - formulae and processes
Intangible Assets
Amortizing intangible assets, Cost	6,951		6,951		6,672
Accumulated amortization	(1,897)		(1,897)		(1,714)
Amortizing intangible assets, Net	5,054		5,054		4,958
Customer backlog
Intangible Assets
Amortizing intangible assets, Cost	3,652		3,652		3,652
Accumulated amortization	(1,839)		(1,839)		(1,656)
Amortizing intangible assets, Net	1,813		1,813		1,996
Developed software
Intangible Assets
Amortizing intangible assets, Cost	2,894		2,894		2,884
Accumulated amortization	(1,737)		(1,737)		(1,581)
Amortizing intangible assets, Net	1,157		1,157		1,303
Non-compete agreements
Intangible Assets
Amortizing intangible assets, Cost	1,542		1,542		1,542
Accumulated amortization	(1,076)		(1,076)		(875)
Amortizing intangible assets, Net	466		466		667
Internet domain and website
Intangible Assets
Amortizing intangible assets, Cost	536		536		536
Accumulated amortization	(142)		(142)		(128)
Amortizing intangible assets, Net	394		394		408
Database
Intangible Assets
Amortizing intangible assets, Cost	387		387		384
Accumulated amortization	(181)		(181)		(167)
Amortizing intangible assets, Net	$ 206		$ 206		$ 217

XML

DEBT - Schedule (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Long-term debt
Long-term debt	$ 334,000	$ 364,000
2017 Revolving Credit Facility
Long-term debt
Loan amount	$ 334,000	$ 364,000

XML

DEBT - Paragraph (Details) $ in Thousands		6 Months Ended
	Apr. 18, 2017 USD ($)	Jun. 30, 2019 USD ($)	Dec. 31, 2018 USD ($)
Sweep Arrangements
DEBT
Advances outstanding		$ 0
2017 Revolving Credit Facility
DEBT
Maximum borrowing capacity	$ 500,000
Loan amount		334,000	$ 364,000
Contractual term	5 years
Accordion feature	$ 200,000
Amount outstanding		334,000
Potential term loan		$ 400,000
Effective interest rate (as a percent)		3.61%
Amount of debt hedged		$ 160,000
Availability for borrowings under line of credit		160,300
Line of credit issued in the form of a standby letters of credit		$ 5,700
Voting equity interest in foreign subsidiaries pledged as security (as a percent)	65.00%
Non-voting equity interest in foreign subsidiaries pledged as security (as a percent)	100.00%
Equity interest in domestic subsidiaries pledged as security (as a percent)	100.00%
Debt instrument hedged (as a percent)		48.00%
Total leverage ratio	3.50
Interest coverage ratio	3.00
2017 Revolving Credit Facility | Minimum
DEBT
Commitment fee (as a percent)		0.175%
2017 Revolving Credit Facility | Maximum
DEBT
Commitment fee (as a percent)		0.35%
2017 Revolving Credit Facility | Equal To Or Greater Than 3.25 to 1.00
DEBT
Minimum consolidated senior secured leverage ratio	3.25
2017 Revolving Credit Facility | Equal To Or Greater Than 2.50 to 1.00, But Less Than 3.25 to 1.00
DEBT
Minimum consolidated senior secured leverage ratio	2.50
Maximum consolidated senior secured leverage ratio	3.25
2017 Revolving Credit Facility | Equal To Or Greater Than 1.75 to 1.00, But Less Than 2.50 to 1.00
DEBT
Minimum consolidated senior secured leverage ratio	1.75
Maximum consolidated senior secured leverage ratio	2.50
2017 Revolving Credit Facility | Equal To Or Greater Than 1.00 to 1.00, But Less Than 1.75 to 1.00
DEBT
Minimum consolidated senior secured leverage ratio	1.00
Maximum consolidated senior secured leverage ratio	1.75
2017 Revolving Credit Facility | Less Than 1.00 to 1.00
DEBT
Maximum consolidated senior secured leverage ratio	1.00
2017 Revolving Credit Facility | LIBOR | Equal To Or Greater Than 3.25 to 1.00
DEBT
Percentage points added to the reference rate	2.00%
2017 Revolving Credit Facility | LIBOR | Equal To Or Greater Than 2.50 to 1.00, But Less Than 3.25 to 1.00
DEBT
Percentage points added to the reference rate	1.75%
2017 Revolving Credit Facility | LIBOR | Equal To Or Greater Than 1.75 to 1.00, But Less Than 2.50 to 1.00
DEBT
Percentage points added to the reference rate	1.50%
2017 Revolving Credit Facility | LIBOR | Equal To Or Greater Than 1.00 to 1.00, But Less Than 1.75 to 1.00
DEBT
Percentage points added to the reference rate	1.25%
2017 Revolving Credit Facility | LIBOR | Less Than 1.00 to 1.00
DEBT
Percentage points added to the reference rate	1.00%
2017 Revolving Credit Facility | Base rate | Equal To Or Greater Than 3.25 to 1.00
DEBT
Percentage points added to the reference rate	1.00%
2017 Revolving Credit Facility | Base rate | Equal To Or Greater Than 2.50 to 1.00, But Less Than 3.25 to 1.00
DEBT
Percentage points added to the reference rate	0.75%
2017 Revolving Credit Facility | Base rate | Equal To Or Greater Than 1.75 to 1.00, But Less Than 2.50 to 1.00
DEBT
Percentage points added to the reference rate	0.50%
2017 Revolving Credit Facility | Base rate | Equal To Or Greater Than 1.00 to 1.00, But Less Than 1.75 to 1.00
DEBT
Percentage points added to the reference rate	0.25%
2017 Revolving Credit Facility | Base rate | Less Than 1.00 to 1.00
DEBT
Percentage points added to the reference rate	0.00%
2017 Credit Agreement, Letter Of Credit
DEBT
Maximum borrowing capacity	$ 75,000	$ 75,000
2017 Credit Agreement, Swingline Loans
DEBT
Maximum borrowing capacity	$ 25,000
2017 Credit Agreement, Swingline Loans | Sweep Arrangements
DEBT
Maximum borrowing capacity		$ 25,000

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CLOSURE AND POST-CLOSURE OBLIGATIONS - Rollforward (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2018
Changes to reported closure and post-closure obligations
Closure and post-closure obligations, beginning of period	$ 79,056	$ 78,363
Accretion expense	1,133	2,258	$ 2,155
Payments	(305)	(775)
Adjustments	35	73
Closure and post-closure obligations, end of period	79,919	79,919
Less current portion	(2,231)	(2,231)		$ (2,266)
Long-term portion	$ 77,688	$ 77,688		$ 76,097

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INCOME TAXES (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2018
INCOME TAXES
Effective tax rate (as a percent)	29.20%	24.40%	28.60%	25.70%
Unrecognized Tax Benefits	$ 616		$ 616		$ 555
Possible reduction in the provision for income taxes if the unrecognized tax benefits were recognized			$ 544

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EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
EARNINGS PER SHARE
Net income	$ 15,491	$ 13,220	$ 23,534	$ 22,463
Basic
Weighted average basic shares outstanding	22,006	21,867	21,997	21,835
Earnings per share (in dollars per share)	$ 0.70	$ 0.60	$ 1.07	$ 1.03
Diluted
Net income, diluted	$ 15,491	$ 13,220	$ 23,534	$ 22,463
Dilutive effect of share-based awards (in shares)	202	157	206	156
Weighted average diluted shares outstanding	22,208	22,024	22,203	21,991
Earnings per share (in dollars per share)	$ 0.70	$ 0.60	$ 1.06	$ 1.02
Anti-dilutive shares excluded from calculation	92	58	86	76

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EQUITY - Stock Repurchase Program (Details) $ in Millions	Jun. 01, 2016 USD ($)
EQUITY
Authorized repurchase amount of outstanding common stock	$ 25.0

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EQUITY - Omnibus Incentive Plan (Details) - Omnibus Plan - shares	Jun. 30, 2019	May 27, 2015
Stock-Based Compensation Plans
Number of shares authorized for grant		1,500,000
Number of shares available for future grant	873,117

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EQUITY - PSUs, Restricted Stock and RSU (Details) - USD ($)		6 Months Ended
	Mar. 01, 2019	Jun. 30, 2019	Dec. 31, 2018
Assumptions used in Monte Carlo simulation
Common stock, shares issued		22,089,000	22,040,000
PSUs
Stock-Based Compensation Plans
Number of common shares each PSU represents (in shares)	1
Vesting period	3 years
Shares
Outstanding at the beginning of the year (in shares)		39,200
Granted (in shares)	17,111	17,111
Vested (in shares)		(13,600)
Outstanding at the end of the year (in shares)		42,711
Weighted Average Grant Date Fair Value
Outstanding at the beginning of the period (in dollars per share)		$ 55.48
Granted (in dollars per share)	$ 58.20	58.20
Vested (in dollars per share)		41.22
Outstanding at the end of the period (in dollars per share)		$ 61.11
Assumptions used in Monte Carlo simulation
Stock price on grant date		$ 58.40
Expected term (years)		3 years
Expected volatility (as a percent)		30.00%
Risk-free interest rate (as a percent)		2.50%
Expected dividend yield (as a percent)		1.10%
Common stock, shares issued		19,414
PSUs | Minimum
Stock-Based Compensation Plans
Percentage payout rate	0.00%
PSUs | Maximum
Stock-Based Compensation Plans
Percentage payout rate	300.00%
Restricted stock
Shares
Outstanding at the beginning of the year (in shares)		74,988
Granted (in shares)		27,800
Vested (in shares)		(39,234)
Outstanding at the end of the year (in shares)		63,554
Weighted Average Grant Date Fair Value
Outstanding at the beginning of the period (in dollars per share)		$ 46.74
Granted (in dollars per share)		62.59
Vested (in dollars per share)		43.77
Outstanding at the end of the period (in dollars per share)		$ 55.50
RSUs
Shares
Outstanding at the beginning of the year (in shares)		66,785
Granted (in shares)		33,020
Vested (in shares)		(26,362)
Cancelled, expired or forfeited (in shares)		(243)
Outstanding at the end of the year (in shares)		73,200
Weighted Average Grant Date Fair Value
Outstanding at the beginning of the period (in dollars per share)		$ 53.77
Granted (in dollars per share)		56.21
Vested (in dollars per share)		48.28
Cancelled, expired or forfeited (in dollars per share)		45.66
Outstanding at the end of the period (in dollars per share)		$ 56.88

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EQUITY - Stock Options (Details)	6 Months Ended
	Jun. 30, 2019 $ / shares shares
Additional disclosures
Number of options exercised via net share settlement	2,252
Stock options
Shares
Outstanding at the beginning of the period (in shares)	236,503
Granted (in shares)	41,100
Exercised (in shares)	(3,246)
Cancelled, expired or forfeited (in shares)	(1,540)
Outstanding at the end of the period (in shares)	272,817
Exercisable at the end of the period (in shares)	191,756
Weighted Average Exercise Price
Outstanding at the beginning of the period (in dollars per share) | $ / shares	$ 44.93
Granted (in dollars per share) | $ / shares	63.36
Exercised (in dollars per share) | $ / shares	42.29
Cancelled, expired or forfeited (in dollars per share) | $ / shares	43.55
Outstanding at the end of the period (in dollars per share) | $ / shares	47.74
Exercisable at the end of the period (in dollars per share) | $ / shares	$ 43.83

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EQUITY - Treasury Stock (Details) - $ / shares	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Treasury Stock
Issuance of restricted stock from treasury stock (in shares)			7,800
Average cost (in dollars per share)	$ 57.77		$ 57.77
Repurchase of common stock (in shares)			14,462
Average cost of repurchase (in dollars per share)			$ 63.34
Dividends
Dividends paid per share (in dollars per share)	$ 0.18	$ 0.18	$ 0.36	$ 0.36

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COMMITMENTS AND CONTINGENCIES - Litigation and Regulatory Proceedings (Details)	3 Months Ended	6 Months Ended
	Jun. 30, 2019 USD ($)	Jun. 30, 2019 USD ($)	Dec. 31, 2018 USD ($)	Nov. 17, 2018 item
Litigation and Regulatory Proceedings
Insurance proceeds from damaged property and equipment		$ 9,500,000
Property insurance recoveries	$ 4,500,000	9,153,000
Explosion at the Grand View, Idaho Facility
Litigation and Regulatory Proceedings
Number of fatalities | item				1
Estimated liability			$ 0
Insurance proceeds from damaged property and equipment		9,500,000
Property insurance recoveries		$ 9,200,000

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OPERATING SEGMENTS - Summarized Financial Information (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019 USD ($)	Jun. 30, 2018 USD ($)	Jun. 30, 2019 USD ($) segment	Jun. 30, 2018 USD ($)	Dec. 31, 2018 USD ($)
OPERATING SEGMENTS
Number of reportable segments | segment			2
Revenue	$ 155,802	$ 136,912	$ 286,839	$ 256,971
Depreciation, amortization and accretion	13,125	10,421	25,186	20,402
Capital expenditures	17,434	7,402	24,657	14,960
Total assets	961,416	824,663	961,416	824,663	$ 947,898
Treatment and disposal
OPERATING SEGMENTS
Revenue	93,512	80,995	174,021	156,351
Transportation and Logistics
OPERATING SEGMENTS
Revenue	35,225	28,465	56,937	47,877
Remediation
OPERATING SEGMENTS
Revenue	889	3,968	2,616	6,158
Other
OPERATING SEGMENTS
Revenue	703	72	1,825	103
Corporate
OPERATING SEGMENTS
Depreciation, amortization and accretion	597	330	901	446
Capital expenditures	920	618	1,253	1,134
Total assets	68,120	98,160	68,120	98,160
Environmental Services | Operating Segment
OPERATING SEGMENTS
Revenue	112,844	98,960	205,177	185,431
Depreciation, amortization and accretion	10,377	8,676	20,003	17,186
Capital expenditures	14,455	4,935	21,296	10,939
Total assets	725,311	599,706	725,311	599,706
Environmental Services | Operating Segment | Treatment and disposal
OPERATING SEGMENTS
Revenue	90,379	78,093	168,092	150,802
Environmental Services | Operating Segment | Transportation and Logistics
OPERATING SEGMENTS
Revenue	22,465	20,867	37,085	34,629
Field and Industrial Services | Operating Segment
OPERATING SEGMENTS
Revenue	42,958	37,952	81,662	71,540
Depreciation, amortization and accretion	2,151	1,415	4,282	2,770
Capital expenditures	2,059	1,849	2,108	2,887
Total assets	167,985	126,797	167,985	126,797
Field and Industrial Services | Operating Segment | Treatment and disposal
OPERATING SEGMENTS
Revenue	3,133	2,902	5,929	5,549
Field and Industrial Services | Operating Segment | Transportation and Logistics
OPERATING SEGMENTS
Revenue	12,760	7,598	19,852	13,248
Field and Industrial Services | Operating Segment | Remediation
OPERATING SEGMENTS
Revenue	889	3,968	2,616	6,158
Field and Industrial Services | Operating Segment | Other
OPERATING SEGMENTS
Revenue	$ 703	$ 72	$ 1,825	$ 103

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OPERATING SEGMENTS - Reconciliation of EBITDA (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Reconciliation of Net Income to Adjusted EBITDA
Net income	$ 15,491	$ 13,220	$ 23,534	$ 22,463
Income tax expense	6,395	4,258	9,436	7,778
Interest expense	3,588	2,907	7,618	5,716
Interest income	(202)	(39)	(409)	(63)
Foreign currency loss	384	139	523	153
Other income	(122)	(193)	(232)	(2,316)
Property and equipment impairment charges			25
Depreciation and amortization of plant and equipment	9,129	7,044	17,254	13,649
Amortization of intangibles assets	2,863	2,296	5,674	4,598
Share-based compensation	1,245	1,011	2,467	2,079
Accretion and non-cash adjustment of closure & post-closure liabilities	1,133	1,081	2,258	2,155
Property insurance recoveries	(4,500)		(9,153)
Adjusted EBITDA	35,404	31,724	58,995	56,212
Operating Segment | Environmental Services
Reconciliation of Net Income to Adjusted EBITDA
Adjusted EBITDA	47,056	39,860	82,316	74,532
Operating Segment | Field and Industrial Services
Reconciliation of Net Income to Adjusted EBITDA
Adjusted EBITDA	5,022	4,562	7,576	6,907
Corporate
Reconciliation of Net Income to Adjusted EBITDA
Adjusted EBITDA	$ (16,674)	$ (12,698)	$ (30,897)	$ (25,227)

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OPERATING SEGMENTS - Revenue and Long-lived Assets (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Revenue and Long-Lived Assets Outside of the United States
Total long- lived assets	$ 540,486	$ 538,109
United States
Revenue and Long-Lived Assets Outside of the United States
Total long- lived assets	481,301	480,322
Canada
Revenue and Long-Lived Assets Outside of the United States
Total long- lived assets	$ 59,185	$ 57,787

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SUBSEQUENT EVENTS (Details) $ / shares in Units, $ in Thousands, $ in Millions				6 Months Ended
	Aug. 01, 2019 CAD ($)	Jul. 26, 2019 USD ($)	Jul. 01, 2019 $ / shares	Jun. 30, 2019 USD ($)	Jun. 30, 2018 USD ($)
Subsequent events
Payments of Ordinary Dividends, Common Stock				$ 7,942	$ 7,884
Subsequent events
Subsequent events
Quarterly dividend declared (in dollars per share) | $ / shares			$ 0.18
Payments of Ordinary Dividends, Common Stock		$ 4,000
W.I.S.E. Environmental Services Inc. | Subsequent events
Subsequent events
Percentage of shares acquired	100.00%
Acquisition price	$ 23.5